1Robert Schmidt and Eric Walters. 2024 Milliman Retiree Health Cost Index. Milliman. milliman.com/en/insight/retiree-health-cost-index-2024.
2IRS. COLA increases for dollar limitations on benefits and contributions. Accessed March 23, 2025. irs.gov/retirement-plans/cola-increases-for-dollar-limitations-on-benefits-and-contributions.
3IRS. 401(k) limit increases to $23,500 for 2025, IRA limit remains $7,000. Accessed March 23, 2025. irs.gov/newsroom/401k-limit-increases-to-23500-for-2025-ira-limit-remains-7000.
4Vanguard. Previewing How America Saves 2025. https://institutional.vanguard.com/content/dam/inst/iig-transformation/has/2025-preview/251114.01_HASPRE_COMM_Commentary_v7_a11y.pdf.
5Social Security Administration. Additional Work Can Increase Your Future Benefits. June 2022. ssa.gov/myaccount/assets/materials/additional-work.pdf.
6Social Security Administration. Starting Your Retirement Benefits Early. Accessed March 23, 2025. ssa.gov/benefits/retirement/planner/agereduction.html.
7Social Security Administration. Retirement Ready Fact Sheet For Workers Ages 18-48. February 2025. ssa.gov/myaccount/assets/materials/workers-18-48.pdf.
8Social Security Administration. What is the average monthly benefit for a retired worker? January 2, 2025. ssa.gov/faqs/en/questions/KA-01903.html.
9U.S. Department of Health and Human Services. Who's Eligible for Medicare? Accessed on March 23, 2025, at hhs.gov/answers/medicare-and-medicaid/who-is-eligible-for-medicare/index.html.
10IRS. 401(k) resource guide – Plan participants – General distribution rules. Accessed on March 23, 2025, at irs.gov/retirement-plans/plan-participant-employee/401k-resource-guide-plan-participants-general-distribution-rules.
11IRS. Publication 590-B (2024), Distributions from Individual Retirement Arrangements (IRAs). Accessed on March 23, 2025, at irs.gov/publications/p590b.
12IRS. Retirement plan and IRA required minimum distributions FAQs. Accessed on March 23, 2025, at irs.gov/retirement-plans/retirement-plan-and-ira-required-minimum-distributions-faqs.
*Due to changes to federal law that took effect on January 1, 2023, the age at which you must begin taking RMDs differs depending on when you were born. If you reached age 72 on or before December 31, 2022, you were already required to take your RMD and must continue satisfying that requirement. However, if you had not yet reached age 72 by December 31, 2022, you must take your first RMD from your traditional IRA by April 1 of the year after you reached age 73.
All investing is subject to risk, including the possible loss of the money you invest.
We recommend that you consult a tax or financial advisor about your individual situation.
When taking withdrawals from an IRA or employer plan account before age 59½, you may have to pay ordinary income tax plus a 10% federal penalty tax.
Withdrawals from a Roth IRA are tax free if you are over age 59½ and have held the account for at least five years; withdrawals taken prior to age 59½ or five years may be subject to ordinary income tax or a 10% federal penalty tax, or both. (A separate five-year period applies for each conversion and begins on the first day of the year in which the conversion contribution is made.)