Ask Terry Questions Turned 70, old accounts; what to do

Turned 70, old accounts; what to do

By Terry Savage on August 15, 2017 | Financial Planning / Retirement

Recently turned 70. Have $10,000 in old 401k from past employer. Also have $10,000 in retirement from another past employer, employer put money in account & interest accrued. What should I do, roll over into something else, know must take withdrawal also. Also, don't need or want to spend the money that has to be withdrawn, can that money just be put into bank account to have money if needed in future?

Terry Says

You need to do a tax-free ROLLOVER of the money in those plans to a rollover IRA at Vanguard or Fidelity.  Call them (1-800-Vanguard or 1-800-Fidelity) and they will handle it so no taxes are due.  Tell them you don't want to risk a penny -- so you want to put it in a money market fund, especially if this is your ONLY retirement money!  They will also advise you that you MUST start making a required minimum withdrawal every year, starting in the year after you reach age 70-1/2.  They will calculate that amount for you.  It will be taxable, on top of your Social Security and any other income, but it will be a very small amount each year.



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