Advertisement
retirement

Contributing to Retirement Accounts When You Haven't Fully Retired

Some part-timers can keep socking money in a 401(k) and avoid required minimum distributions. It depends on your plan's rules.

Question: If I "retire" from full-time work but continue with the same employer part-time, can I still contribute to my company's 401(k), or do I have to stop at age 70½? Also, can I avoid having to take RMDs at age 70½ because I’m still working there, or do I need to work a certain number of hours to qualify?

Advertisement - Article continues below

Answer: Employers can't prevent employees from participating in their 401(k)s just because they reach a certain age, so you should be able to contribute even after age 70½ if you qualify otherwise. However, some employers let part-time workers participate in their 401(k)s while others do not, and the number of hours required to be eligible can vary by employer, too, says Keith McGurrin, a certified financial planner with T. Rowe Price.

Whether or not you're still working, you'll need to start taking RMDs from your traditional IRAs after you turn 70½. You can't make new contributions to traditional IRAs after age 70½, but you can contribute to a Roth IRA at any age if you have earned income from a job.

Advertisement

Most Popular

HSAs Get Even Better
Financial Planning

HSAs Get Even Better

Workers have more options with flexible spending accounts, too.
July 2, 2020
Find a Great Place to Retire
happy retirement

Find a Great Place to Retire

Our cities provide plenty of space to spread out without skimping on health care or other amenities.
July 2, 2020
What Are the Income Tax Brackets for 2020 vs. 2019?
tax brackets

What Are the Income Tax Brackets for 2020 vs. 2019?

The IRS unveiled the 2020 tax brackets, and it's never too early to start planning to minimize your future tax bill.
June 20, 2020

Recommended

Find a Great Place to Retire
happy retirement

Find a Great Place to Retire

Our cities provide plenty of space to spread out without skimping on health care or other amenities.
July 2, 2020
Searching for the Perfect Place to Retire
Empty Nesters

Searching for the Perfect Place to Retire

We home in on two places with less traffic and lower costs. 
July 2, 2020
Hail to Your Finances, Regardless of Who Wins Presidency
retirement planning

Hail to Your Finances, Regardless of Who Wins Presidency

Don’t try to navigate your investment choices based on election uncertainty. And don’t wait to find out who wins in November to make financial decisio…
June 30, 2020
Resources for alternative forms of transportation needed by many older adults
retirement

Resources for alternative forms of transportation needed by many older adults

For many older adults, having an alternative mode of transportation may be the difference between independence and social isolation.
June 29, 2020