When it comes to financial planning, some birthdays are more significant than others. Do you have any key financial birthday’s coming up?

Age 21 When the beneficiary comes of age (typically 21 in most states), the custodian is legally obligated to transfer the ownership and control of the account to the beneficiary.

Age 26 You can no longer stay on your parents health insurance coverage.

Age 50 When you turn 50, you can add more to your 401(k) plan. In 2024, the maximum is $23,000, plus an additional $7,500 for those turning 50 or older.

Age 55 Penalty-free distributions may be taken from 401(k) plans if retired. Catch-up contributions may be made to HSAs.

Age 59 ½ You can take penalty-free distributions from IRAs and qualified plans. Roth IRAs if the account has been open at least 5 years. If you haven’t already, now could be a good time to consolidate old 401(k) plans.

Age 60 Widows or widowers seeking benefits under their spouse’s earnings record can apply for Social Security benefits early.

Age 62 Applications may be made for early Social Security benefits. However, doing so can reduce your monthly benefits by 30% versus waiting till your full retirement age.

Age 65 Applications should be made for Medicare benefits unless covered by a group plan.

Age 66/67 Full retirement age for unreduced Social Security. Age 66 for people born 1943-1954 and age 67 for people born after 1960.

Age 70 Apply for Social Security to get your maximum benefits. Your benefits will not increase if you delay past your 70th birthday.

Age 73/75 Required Minimum Distributions (RMDs) are the minimum amounts that the owner of a retirement plan account must withdraw annually. If you were born between 1951-1959 RMDs will start at age 73. If you were born 1960 or later, RMDs will start at age 75.

For any questions related to key birthdays or general financial planning, please don’t hesitate to contact our team.

George Maroudas, CFP®

George Maroudas, CFP®

Twitter @ChicagoAdvisor

Disclaimer / Sources:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.