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Happy Birthday 2020: Some important ages and their financial impacts for the coming year

This post will probably become a tradition of ours but even though it might look familiar be sure to read to the end because there have been some important updates you won’t want to miss!


There are a set of important ages when it comes to retirement planning and we thought it would be a great way to kick off our newsletters this year with a reminder for all of those who might be having a key birthday in 2020!


50! – Happy birthday to everyone turning 50 this year!  As a present the government will allow you to make “catch-up” contributions to your retirement accounts.  Here’s what the breakdown looks like:

Account Type

 Max Contribution

Catch Up











55! – A big happy birthday to these folks as well, as you’re getting a bit older and perhaps a little more worried about healthcare costs the government allows catch up contributions your HSA:

Account Type

 Max Contribution Ind/Family Catch Up Ind/Family
HSA $3,550/$7,100



59 ½! – This is a big year for you!  You’re now allowed to take money out of your retirement accounts without incurring a 10% penalty!  This is the year your retirement assets become available to you for income if you need it.  It’s important to remember that any money you distribute from a tax deferred account will be classified as taxable income so plan on writing Uncle Sam a check at the end of the year if you do make distributions.  It’s important to coordinate accounts for retirement income to minimize your tax obligation, remember to speak to an advisor if you aren’t sure how to do this.


62! – This is the age when you’re eligible for your reduced social security benefits.  If you turn 62 in 2019, you’re entitled to roughly 75% of your full retirement benefits.  Be careful though, if you elect to take your benefit early, you’ll be locked into a lower monthly income and miss out on your full benefit.  A sound financial plan should be in place before you decide to collect your benefit (especially early at a reduced amount!).


65! – Congrats!  You’re now eligible for Medicare!  Medicare enrollment begins 3 months prior to your 65th birthday and spans from that date until 3 months after the month you turn 65 so don’t forget to enroll!  If you miss that window, you’ll have to wait for general enrollment which will delay your coverage for several months and could leave you with a gap in health insurance (which you definitely do not want!).  This is also a great time to begin looking into Medigap policies to fill certain “gaps” in the coverage Medicare provides on its own.  We definitely recommend speaking to an advisor to see what might be appropriate for you.

66! – If you were born between 1943 and 1954, this is the year that you’re entitled to your full social security benefit!  Once you hit this age, you’re no longer penalized for taking your benefit early!  You can also earn as much as you’d like (if you’re still working) while collecting your benefit and not be penalized at all.  Again, before you elect to claim your benefit be sure to have a plan in place so that all of your retirement income streams are coordinated and working well together.

70! – If you’ve delayed taking your social security benefit make sure that you’ve claimed it by your 70th birthday.  After that age there are no more delayed retirement credits, your benefit no longer grows for delaying any further so if you wait past this birthday, you’re literally letting income slip through your fingers!  Long story short – IF YOU HAVEN’T CLAIMED Social Security BENEFITS BY THE TIME YOU TURN 70 GO DO IT NOW!

70 ½! – This one’s a little tricky……if you turned 70 ½ in 2019 you have until April 1st of 2020 year to take your Required Minimum Distributions (RMD) from your tax-deferred retirement accounts (401k, IRA, 403b, etc.).  However, due to the recent passing of the SECURE Act if you turn 70 ½ in 2020 your required minimum distributions don’t take place until April 1st of the year after you turn 72!  Failure to take the required amount results in a 50% penalty so make sure you distribute what’s required!  Also, as a reminder, if you wait until April 1st of the year after you turn 72 to take your RMD you’ll have to take two RMDs in one year which will increase your income and could increase total taxes or marginal rates.  Speak to your advisor to find out what your RMD obligations might be this year and how you should plan accordingly for the tax implications of this additional income.

If you have any questions about the info above please don’t hesitate to reach out to us at 888-270-1574 or and we’ll be happy to help clarify!


We hope that everyone has a healthy, happy and prosperous 2020!


Innova Wealth Partners, LLC (“Innova”) is a registered investment advisor. Information presented herein is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. 


Readers of the information contained on these performance reports, should be aware that any action taken by the viewer/reader based on this information is taken at their own risk. This information does not address individual situations and should not be construed or viewed as any typed of individual or group recommendation. Be sure to first consult with a qualified financial adviser, tax professional, and/or legal counsel before implementing any securities, investments, or investment strategies discussed.


Any tax information and estate planning information contained herein is general in nature, is provided for informational purposes only, and should not be construed as legal or tax advice. Innova does not provide legal or tax advice. Innova cannot guarantee that such information is accurate, complete, or timely. Laws of a particular state or laws that may be applicable to a particular situation may have an impact on the applicability, accuracy, or completeness of such information. Federal and state laws and regulations are complex and are subject to change. Changes in such laws and regulations may have a material impact on pre- and/or after-tax investment results. Innova makes no warranties with regard to such information or results obtained by its use. Innova disclaims any liability arising out of your use of, or any tax position taken in reliance on, such information. Always consult an attorney or tax professional regarding your specific legal or tax situation.


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