Wherever you are on the retirement timetable, it's important to keep some critical ages in mind:
- 55: If you decide to leave, or lose, your job beginning in the year you turn 55, you might be able to withdraw from tax-deferred savings plans without owing a 10 percent tax penalty, as long as you qualify for one of the exceptions spelled out in the federal tax code. You may also be eligible for pension benefits from some employer plans if you have enough years of service.
- 59½: You can generally withdraw money from your personal tax-deferred savings plans (IRAs, annuities) and from your employer-sponsored savings plans if you've retired from your job without owing a 10 percent tax penalty.
- 60: You can receive Social Security benefits if you are a widow or widower.
- 62: You may be eligible for full pension benefits from your employer, depending on the plan. You can begin to receive reduced Social Security benefits if you choose. "Reduced" means you’ll receive 20 to 30 percent less each month than if you wait until you reach your full retirement age—and your spouse’s may be reduced even more. The Social Security Administration (SSA) offers helpful information on when to start receiving retirement benefits.
- 65: You can receive full pension benefits from most employers, as well as full Social Security benefits if you were born in 1937 or earlier. If you are a widow or widower, you can receive full Social Security benefits if you were born before January 2, 1940. If you were born after 1937, your eligibility depends on the year of your birth. At 65, you normally also qualify for Medicare benefits.
- 66-67: You can receive full Social Security benefits at age 66 if you were born between 1943 and 1954. For those born between 1955 and 1960, it increases annually from 66 and 2 months to 67. If you were born in 1961 or later, your full retirement age is 67.
- 70: You should begin to collect your Social Security benefits if you haven't already. There is no additional benefit increase after you reach age 70, even if you continue to delay taking benefits.
- 70½: You must begin withdrawals from your traditional IRAs, but not from Roth IRAs. You must also begin withdrawals from employee-sponsored retirement plans, such as a 401(k), unless you're still working.