Retirement should be an easy concept: You stop working, start spending the nest egg and start checking off those bucket list trips.

Unfortunately, it’s a bit more complicated than that; Social Security can withhold payments. Medicare premiums can reach nearly $600/mo. and the IRS can penalize you for not spending retirement accounts.

The rules seem to change every year, so here are some common questions (and answers) relevant in 2024:

1.       When Should I Claim Social Security? It depends. If you draw early at age 62, your social security check will be roughly 30% less than at Full Retirement Age (between 66 or 67 depending on your birthday). If you wait until age 70, your check will be 24% more.

2.       Is there a penalty for drawing social security while I’m still working? Not if you’ve reached Full Retirement Age. If you claim early, your benefit can be reduced if you’re earning over $21,240 from work.

3.       How much are Medicare Premiums? This depends on your reported income from 2 years prior. Medicare part B premiums start at $174.70 but can escalate to $594 depending on Income-Related Monthly Adjustment Amounts (IRMAA).

4.       When do I need to draw from my retirement accounts? Required Minimum Distributions begin the year your turn 73.

5.       Can I delay RMD’s if I’m still working? If you’re still working, (and are not an owner of the business) you can delay your workplace retirement distributions until you leave the company.

6.       What should I do with my workplace retirement plans when I retire? Most people transfer these balances (non-taxable) balances to an Individual Retirement Account (IRA) and plan their investment/withdrawal strategy from there.

7.       How risky should my investments be when I’m retired? This depends on your risk tolerance, timeframe, distribution plans, tax rate and account goals. It’s best to speak with an advisor before making investment decisions.

 As always, your tax and financial situation is as unique as yours. Feel free to reach out if you’d like a second look at your current picture.