Retirement Distribution Solutions

When investors think about retirement plans, many focus on putting away cash and then investing it wisely to grow their nest egg. But there’s a critical piece of retirement income planning that’s often overlooked: a strategy to withdraw those carefully tended savings.

Understanding retirement distribution guidelines
When can you withdraw distributions?	To take distributions from most 401(k), 403(b), 457(b) and profit- sharing plans, you generally must leave your job (separate from service) or reach age 59 ½.
When will you face a penalty for withdrawing distributions?	A 10% IRS penalty may apply to taking early distributions from most retirement plans. Note: 457(b) plans don't carry this penalty.
How are distributions taxed?	Distributions are generally taxable as income. However, you can take tax-free distributions from a Roth IRA if you've participated in the plan for at least five years and reached age 59 ½.
What is the age you’re legally required to withdraw distributions?	Most plans require that you start taking required minimum distributions (RMDs) by April 1 of the year following the calendar year you reach age 72, regardless of whether you remain employed. These distributions are based on your life expectancy and your account balance at the end of the previous year. RMDs are usually taxable, and there is a 50% penalty on the amount not taken if you skip them or take less than the required amount.

You may no longer be getting a paycheck, but with proper planning, you can continue earning a steady income after you retire. Good practice is to pay for essential expenses with predictable income, and if possible, fund discretionary expenses with fluctuating income as appropriate for your needs.

Key takeaway: How and when you take your money matters. Make sure you talk with a financial professional to create an income plan so you can preserve your savings and help determine the best distribution option so you can retire well.

Getting started is easy! Simply fill out the form below and set up a meeting with one of our experienced team members. In this introductory call, we’ll discuss your financial goals and go over the materials we need from you in order to move forward.

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