In past articles we have hit on things like, Social Security, saving, budgeting, investing, and personal finance. Today, we want to talk about retiring and more specifically suggestions for transitioning to retirement.
Your retirement planning strategy may change as you near the end of your career, but it doesn’t ever stop — even after you retire. There are some important things to think about at eight different ages as you progress to and through retirement.
Age 50 – At this point in your working career you might be ending the spending years, right in the thick of it, or somewhere in between. It is important to remember the more you save for retirement, the more you will have. At age 50, you are now of age to utilize the catch-up contribution that will allow you to save more than the standard IRS limit ($19,000 – 2019) via catch-up ($6,000 – 2019), on the last leg to retirement.
Age 59½ – Congratulations, you have reached early retirement age. This is the age at which you can retire early and dip into your retirement account with an early-withdrawal penalty. Some plans allow this to occur without having to leave the workplace by having an in-service distribution clause. This can be useful for those semi-retiring.
Age 62 – Congratulations! You may be eligible for Social Security. But think twice before taking Social Security now. It could mean a 25-30% reduction in the amount you'll receive. If you’re still working, the amount could be reduced even more. For each year you wait to claim Social Security your benefit can increase by 7-8%, capping out at age 70.1
As you progress towards retirement, we hope that these suggestions will be a guide to you as you navigate new territory, retirement.
1: Information was taken from www.ssa.gov