As a rule, we don’t like to think about aging. But getting older has its perks, especially with regards to your finances. In fact, the older you get the better your perks. Let’s take a look at some of these benefits you’ll be able to look forward to, and take advantage of, as you age.
Your 50’s
Retirement is approaching and the new perk, of age, is stashing extra funds into your qualified retirement accounts. Once you reach your 50’s, you’re allowed to make “catch-up” contributions of $6500 to your 401k account(s) by the end of the year. For IRAs, whether you have a ROTH or a traditional IRA, an additional $1000 is due by the IRS deadline for your tax return. SIMPLE-IRA and SIMPLE 401(k) plans may also allow catch-up contributions. Catch-up contributions are only allowed if participants have already contributed the maximum allowed to the respective retirement account; it’s the bonus of being age 50+. Check out this IRS article to get the details and deadlines for 2022, or inquiry with your plan administrator to enroll in this perk!
Anyone 50 years and older can also claim certain senior discounts at restaurants, movie theaters, golf courses, and various clubs. You might be thinking these perks don’t apply until you’re in your 60’s, but that is not always the case. The Osher Lifelong Learning Institute provides no credit free college courses to those age 50+ a great way to pick up new knowledge and skills.
At 55, you’ll have NO 10% tax penalty if you choose to withdraw funds from your 401k or 403b account(s). If you qualify as a public safety worker, you can withdraw your funds as early as age 50.
The age of 55 seems to be the “golden age” when it comes to benefits and discounts. Make sure you check for any various things you might be entitled to at this age, such as senior plans with your cell phone provider or utility providers. You might also qualify for special senior rates with various travel services, such as rental cars and hotels. Even if your mind and body don’t feel like a senior, your wallet appreciates the break.
AARP is also an option to join at this “golden age,” if your values align with this lobbying group. Being a member secures age-based discounts and they also have buying power, meaning companies and businesses specifically target AARP members as valuable contributors to the economy.
Once you reach 59½, you will be able to make penalty-free withdrawals from your IRA or 401k accounts! Consult your investment advisor and tax preparer to discuss the impact and benefits of this decision.
Your 60’s
When your 60’s roll around, a few other perks come into play as well. At the age of 62, you’ll be eligible for early social security retirement benefits. Your retirement benefits might be reduced by as much as 30% depending on the year you were born, but it is still a viable option if you choose to retire early.
When you hit 65, you’ll be eligible to enroll for Medicare Part A, which gives you coverage for nursing facilities, hospitals, some health care, and hospice care. These benefits can only be applied for once you turn 65, not before. You’ll need to enroll at 65, and not 66 or 67 or beyond, to avoid late enrollment penalties and to offset any unexpected costs of a hospital stay. Another benefit of age 65, is earning additional tax deductions, including an increased standard deduction.
Feeling the urge to travel? Travel perks such as discounted car and hotel rental rates or even a Senior Lifetime National Park Pass are available to you.
Your 70’s
Now that you have hit this milestone new perks await you. For homeowners, it’s time to investigate additional property or school tax exemptions or deferrals. Check your state, county and local rules as age restrictions and exemption amounts vary across the country.
If you are 70½ now, you must take the required minimum distributions (RMD) from your IRA accounts. The age used to be 72, however it was lowered to 70½ in 2019 according to the IRS. By the time you’re in your 70’s, you’ll be able to fully enjoy the money you’ve tucked away for retirement throughout your lifetime. Don’t be ashamed to take full advantage of it. This is what you’ve worked toward for years.
Working Toward Retirement
As we age, certain restrictions, fees, and penalties start to lift which gives us an easier time financially as we age. The older we get, the more we collect our financial perks until eventually, we’re living off the money we’ve saved for our retirement. It’s absolutely worth it to take a look into other areas where you might receive certain age-related benefits.
Embrace your age—and your benefits!
At Organized Instincts, our seasoned team of daily money managers can help you streamline your financial tasks and routines. We will help you take advantage of these perks. Schedule a free consultation today and give yourself the freedom to joyfully and abundantly live life.