There are three ages that should play a key role in your retirement planning. And, theSetting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act) changed these ages. If you pay attention to the current retirement laws now, you can take action to maximize future benefits. Here are the three ages to keep in mind when building your retirement plan strategy.

Age 50: Make catch-up contributions

The IRS sets a limit on how much you can contribute to your retirement plan each year. If you participate in a 401(k) or 403(b) plan, your contribution limits for 2020 and 2021 are $19,500. If you participate in an individual retirement account (IRA), your limit is $6,000. You can learn more about the 2021 contribution limits for different plan types here. At age 50, you can begin making catch-up contributions to your retirement plan. Catch-up contributions are contributions that exceed your annual contribution limit. In 2021, catch-up contributions are limited to $1,000 for traditional and Roth IRAs, and $6,500 for most 401(k) and 403(b) plans.  

Age 59½: No penalties for withdrawals

When you reach 59½, you can make withdrawals from your IRA or another qualified retirement plan, such as a 401(k), without penalty – if your plan document allows withdrawals. If you do make a withdrawal, those funds are likely subject to income tax. Withdrawals made before age 59½ might be subject to a 10% early withdrawal tax. Exceptions to this rule include making withdrawals for certain medical expenses and purchasing your first home.  

Age 72: Make withdrawals and continue contributions

You’re required to make annual withdrawals from your IRA and 401(k) at age 72. These withdrawals are also calledrequired minimum distributions (RMDs). Before the SECURE Act, you had to make these withdrawals at age 70½. However, if you turned 70½ on or before Dec. 31, 2019, the new rules don't apply to you. You’re still required to continue taking RMDs from your retirement account. The SECURE Act also allows you to make contributions to your traditional IRA after the age of 70½. Why? Many Americans continue to work beyond the standard retirement age. Originally published 8/15/18. Updated 1/12/21.