How we f’d this up about retirement
What did we do to screw this up about retirement? How can we fix it? Discover them here on this episode. Then download your FREE Queer Money Kickstarter, a 9-step Guide to Kickstart Your Journey to Financial Independence.
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We f’d this up about retirement
On this Queer Money®, we’re sharing corrections and clarifying the minimum distribution requirements for IRA accounts. On Queer Money® episode #546, titled: 12 Sources of Income in Retirement, we made a mistake and quoted old required minimum distribution ages (RMDS). They’ve been updated, and we’re here to correct it.
Per IRs.gov, RMDs Basics are the minimum yearly withdrawals required from retirement accounts. The SECURE Act of 2019 raised the RMD age from 70½ to 72. However, the SECURE Act 2.0 further raised it to 73 years old. For those who turned 72 on or after January 1, 2023, individuals who turned 72 in 2023 didn’t need to take an RMD that year; they could delay it until 2024. Because of the SECURE Act 2.0, anyone in 2024 must start taking an RMD if they are 73 or older.
What types of accounts does this affect? Traditional IRAs, SEP IRAs, SIMPLE IRAs, and retirement plans like 401(k)s or 403(b)s. There are some exceptions. Workplace Plan Exception for 401(k)s, 403(b)s if you are 73 or older, RMDs can be delayed until retirement, except for business owners with 5% or more ownership. For Roth Accounts, Roth IRAs have no RMDs during the owner’s lifetime. Roth 401(k)s/403(b)s had RMDs through 2022–2023 and are no longer required in 2024 and beyond—withdrawals Above Minimum. You can withdraw more than the minimum required but not take it below it. Remember, taking more out could mean you run out of money in retirement. The other thing to remember is that money from these accounts is Taxable. Withdrawals are taxable unless they come from non-taxable funds or qualified Roth distributions. Talk to your financial advisor or accountant about how withdrawals could affect your taxes.
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Previous Bonus Podcast Episodes
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