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7 Key Retirement Deadlines You Won't Want to Miss

Taking steps at each of these stages on the road to retirement could help you maximize your income, minimize your taxes and avoid penalties

YEARS BEFORE MANY PEOPLE RETIRE, key dates and deadlines pop up—things like being able to make catch-up contributions to your 401(k) and IRA starting the calendar year you turn 50 and signing up for Medicare Part A at 65, even if you’re still working. If you aren’t aware of them, they’re easy to miss. Below are seven important stops along the way to retirement readiness.

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“The decisions you make during pre- and post-retirement years can be important in determining how much money will be available during retirement, so it is important to understand these key dates and their implications,” Debra Greenberg, director, Retirement and Personal Wealth Solutions at Bank of America. It is also a good idea to check in with your financial advisor and tax advisors regularly in the years leading up to retirement to assess your progress toward your goals, she adds. 

Age 50 highlighted in a large red and yellow circle Title- Play Catch Up.

You’re now eligible to make “catch-up” contributions to 401(k)s and other employer-sponsored retirement plans, as well as to IRAs.1 The IRS “catch-up” contribution limits are adjusted periodically. Our Annual Contribution Limits Guide can help you determine how much more you can invest. As an added benefit, you may be able to reduce your taxable income by increasing contributions to a tax-deferred traditional IRA or qualified retirement plan.  

1Consult your tax advisor as there are phase-out ranges for IRA contribution deductibility based on modified adjusted gross income (MAGI) ranges that are published annually and correspond to your federal tax filing status (married, filing jointly; married, filing separately; or single) and whether or not you participate in an employer-sponsored retirement plan.

Age 59½ highlighted in a large red and yellow circle. Title- No More Early Withdrawal Penalty

Once you reach age 59½, withdrawals from employer-sponsored retirement plans and IRAs are no longer subject to the additional 10% federal tax on early withdrawals —though you still may owe regular income tax on the distributions. But it’s generally better to keep your tax-advantaged retirement savings or investments intact so you don’t sacrifice potential growth, suggests Greenberg. 

Age 62 highlighted in a large red and yellow circle. Title- Social Security- To Claim or Not.

Age 62 is the minimum age at which you can choose to begin receiving Social Security benefits. But bear in mind that for each year you postpone taking this benefit (until age 70), your monthly check will be larger. Read “Social Security: Aiming for Smarter Payments” for more insights.  

Age 65 highlighted in a large red and yellow circle. Title- Time to Apply for Medicare.

If you’re already receiving Social Security, you’re automatically enrolled in both Parts A and B of Medicare. But if you aren't yet receiving Social Security, you will need to apply for Medicare during one of the designated annual enrollment periods. Your initial enrollment period lasts for seven months, beginning three months before the month in which you turn 65. Missing your enrollment date may mean penalties or even higher premiums for the rest of your life. See “Your Guide to Medicare: 5 Key Questions Answered” for more insights, including what you should do if you’re still working. 

Age 66 highlighted in a large red and yellow circle. Title- You've Reached Full Retirement Age.

If you were born between 1943 and 1954, age 66 is your “full retirement age” for Social Security. That’s the age at which you may first become entitled to full or unreduced retirement benefits. For those born after 1954, the full retirement age will increase by two months a year until the current maximum of age 67 for those born in 1960 and later.

Age 70 highlighted in a large red and yellow circle. Title- Claim Your Maximum Benefit.

If you’ve waited until your 70th birthday to begin taking Social Security, you’ll now get the biggest possible monthly benefit, which may be as much as 76% larger than if you had started receiving payments at age 62. Any further delay in claiming won’t increase the size of your check.

Age 70 ½ highlighted in a large red and yellow circle. Title- Access What You’ve Saved.

Even if you don’t feel ready to start withdrawing funds from your IRAs and qualified retirement plans, the government requires you to do so once you reach a certain age. The amounts of these required minimum distributions, or RMDs, will vary from year to year, depending on the value of your retirement accounts and your age. Failing to take an RMD, or taking an insufficient amount, can result in costly penalties. Choosing an appropriate distribution strategy can help you avoid issues and make the most of your retirement assets. For details on the latest legislation and regulation impacting your investment accounts, review the CARES Act information here—and be sure to consult with your tax professional.

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Bank of America is a marketing name for the Retirement Services business of Bank of America Corporation.

This material should be regarded as general information on Healthcare and Social Security considerations and is not intended to provide specific healthcare or social security advice. If you have questions regarding your particular situation, please contact your legal or tax advisor.

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