When it comes to retirement milestones, there’s rarely one right answer — especially since the federal government may move targets or use variables that can be confusing.
Case in point: A few years ago, the age at which many people are required to start withdrawing money from most types of retirement accounts was bumped from the year you turn 70½ to the year you turn 72. More recently, it was bumped again — and now it’s not the same age for everyone.
What follows is a list of key ages for retirement planning — including the ones for those required withdrawals — with details about who is affected, and how.
Age 50: Retirement account catch-up contributions
Everybody should steadily save for retirement. But the federal government tries to make it a little easier on those who got a late start by allowing “catch-up contributions.”
These are higher limits on the amount of money that people 50 and older can put in retirement accounts each year.
For example, for 2023, the base contribution limit for most workplace retirement accounts is $22,500 and the catch-up contribution limit is $7,500.
That means that someone who is 49 or younger can put a total of up to $22,500 in a 401(k) plan this year. But someone who is 50 or older can put $22,500 plus an additional $7,500 — for a total of $30,000 — in a 401(k).
For more details about the current contribution limits for all types of retirement accounts, check out “IRS Hikes Nearly All Retirement Account Thresholds for 2023.”
Age 55: HSA catch-up contributions
The IRS allows catch-up contributions with another type of account: health savings accounts, or HSAs.
For 2023, those age 55 and older can contribute an additional $1,000 to their HSA each year, assuming they’re eligible for one of these accounts.
Designed for people who have high-deductible health insurance plans, an HSA is a savings or investment account from which you can reimburse yourself for eligible medical expenses.
HSAs are also tax-free, provided that you follow the IRS rules for them. As we detail in “3 Ways a Health Savings Account Can Improve Your Finances“:
“Putting money in a health savings account is one of the very few ways you can entirely avoid paying any taxes on your money — ever.”
Age 59½: Penalty-free retirement account withdrawals
Money in your retirement accounts can be tapped early for purposes other than retirement, but it’s not a choice to make lightly. Early withdrawals from individual retirement accounts (IRAs), for example, generally are subject to a 10% tax penalty.
That penalty disappears at age 59½.
Age 60: Social Security survivor’s benefits
Survivor’s benefits are a type of Social Security benefit for family members of people who have died but were receiving or were eligible to receive benefits at the time of their death.
If you are eligible for survivor’s benefits, you can generally start receiving them at age 60.
Age 62: Early Social Security retirement benefits
If you qualify for Social Security retirement benefits based on your own earnings history, or that of a spouse or ex-spouse, you can start receiving those benefits once you turn 62.
Your benefit will be reduced for claiming before you reach what’s known as your full retirement age. But, some people can justify claiming as early as age 62, as we cover in “5 Times When It’s Smart to Claim Social Security Early.”
Age 64¾: Medicare enrollment
As you approach age 65, don’t miss your initial enrollment period for Medicare, the federal health insurance program that primarily serves people who are at least 65.
This one-time enrollment period includes the month you turn 65, the three months before and the three months after. In other words, it starts around age 64¾.
Failing to enroll on time can delay your Medicare benefits and result in hefty, permanent financial penalties, as we detail in “4 Pitfalls for New Medicare Enrollees.”
But if you’re already collecting Social Security benefits when you turn 65, the Medicare program will contact you automatically, so you don’t need to worry about remembering to sign up.
Age 65: Medicare benefits
If you sign up for Medicare in the first three months of your initial enrollment period, your Medicare benefits generally will begin the month that you turn 65.
The Medicare program explains:
“If you sign up for Part A and/or Part B during the first 3 months of your Initial Enrollment Period, in most cases, your coverage begins the first day of your birthday month. However, if your birthday is on the first day of the month, your coverage starts the first day of the prior month.
If you sign up the month you turn 65 or during the last 3 months of your Initial Enrollment Period, your coverage starts the first day of the month after you sign up.”
Age 66 to 67: Full retirement age for Social Security
The amount of your Social Security benefit is based in part on when you start taking it. To get your full benefit — meaning an un-reduced benefit — you need to reach your full retirement age before claiming.
That age target depends on when you were born. Here’s a summary from the Social Security Administration:
- If you were born in 1943-1954: Your full retirement age is 66
- 1955: 66 and 2 months
- 1956: 66 and 4 months
- 1957: 66 and 6 months
- 1958: 66 and 8 months
- 1959: 66 and 10 months
- 1960 and later: 67
Age 70: Maximum Social Security benefit
You also can wait until after your full retirement age to claim Social Security — until as late as age 70 — and receive a permanently higher benefit as a result.
As we explain in “7 Reasons Not to Take Social Security at Age 62,” delaying until age 70 results in receiving your maximum possible benefit — more than the benefit you’d get at your full retirement age. For every year you hold off past full retirement age, your benefit will jump by as much as 8%.
Beyond age 70, there’s no further benefit increase possible.
Age 73-75: Required minimum distributions
Required minimum distributions (RMDs) are a minimum amount of money that you generally must withdraw from most types of non-Roth retirement accounts each year, starting the year you reach a certain age.
Previously, that age was 72, but the recent Secure 2.0 Act changed the start age to 73. And if you aren’t age 74 or older by the end of 2032, the start age is 75.
Age 73+: Qualified charitable distributions
Once you are taking your RMDs — at whatever age you happen to be — you can count charitable donations as part of it, provided you follow the rules. This is known as a qualified charitable distribution (QCD), and it allows you to exclude up to $100,000 in gross income from taxes each year.
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