Maximizing Your 401(k) After Age 70: A Friendly Guide for Senior Workers

🧭 Index

1. Introduction

2. What You’ll Learn

3. Understanding 401(k) Contributions After 70

4. Required Minimum Distributions (RMDs) Explained

5. Delaying RMDs When Working

6. Comparing 401(k) & IRA Rules at Older Ages

7. Two Real-Life Examples

8. Key Statistics & Charts

9. Practical Tips for Managing Your 401(k) After 70

10. Conclusion

11. FAQs

12. Call to Action

1. Introduction

Retirement doesn’t always follow a predictable schedule—and many professionals are choosing to stay in the workforce past age 70. Thankfully, retirement-plan rules have evolved to support this shift. In this guide, we'll explore how you can contribute to, defer, and withdraw from your 401(k) after 70, helping you optimize savings and taxes. Let’s dive in!

2. What You’ll Learn

In this article, we'll cover:

• Changes to contribution rules after age 70

• How Required Minimum Distributions (RMDs) work

• Exceptions for working beyond 70 and still using your 401(k)

• Comparison with IRA rules

• Real-world examples and statistics

• Smart strategies and practical tips

3. Understanding 401(k) Contributions After 70

Good news! Under current regulations (SECURE Act and SECURE 2.0):

• There’s no age limit on contributing to your traditional or Roth 401(k) as long as you’re working. 

• Contribution limits for 401(k)s in 2025:

  • Under 50: $23,500

  • Age 50+: $31,000 (includes $7,500 catch-up)

  • Age 60–63: $34,750 (enhanced catch-up) 

If your employer offers a Roth option, you can also continue contributing post-tax dollars toward tax-free growth—no limits tied to age.

4. Required Minimum Distributions (RMDs) Explained

Once you reach age 73 (or to age 75 after 2033), RMDs kick in:

• RMD Age Schedule

  • Born before Jul 1, 1949: 70½

  • Born 1949–1950: 72

  • Born 1951–1959: 73 (increased in 2023)

  • Born 1960+: 75 (effective 2033) 

• Calculation
  RMD = prior Dec 31 account balance ÷ IRS life-expectancy factor (Uniform Life Table). Example: age 73 factor ≈ 26.5.

• Deadline
  First RMD: by April 1 the year after hitting RMD age
  Subsequent RMDs: by Dec 31 each year 

• Penalty for Missed RMDs
  Up to 25% of the undeclared amount (down from 50%)—reduced to 10% if corrected in 2 years. 

5. Delaying RMDs When Still Working

If you’re still employed at age 73 by a company where you own less than 5%, you can postpone RMDs from that employer’s 401(k) until you retire. 

👍 This offers two big benefits:

• You avoid extra income that could raise your Medicare premiums or taxes

• You can continue saving and compounding tax-deferred for longer

6. Comparing 401(k) vs IRA Rules After 70

Feature	401(k) (Employer Plan)	IRA (Traditional & Roth)
✅ Contribute after 70½?	Yes, if employed	Yes, no age limit (SECURE Act)
⏳ RMD Age	73 (or delayed if still working <5%)	73 for traditional IRA; none for Roth until death
🧾 Penalty for missed RMD	25% (reduced to 10%)	Same
🔄 Rollover allowed	Non-RMD amounts only	Similar applies

7. Real-Life Examples

7.1 Example 1: Jennifer (Age 72, still employed)

• Contributions: continues $30,500/year (50+ catch-up)

• RMD: deferred until retirement

• Benefit: Extra time to save and avoid taxable withdrawals

7.2 Example 2: Robert (Age 74, retired)

• 12/31/2023 balance: $200,000

• Life expectancy factor (age 74): ~25.5

• Required RMD = $200,000 ÷ 25.5 ≈ $7,843 (due Dec 31, 2024)

• If not withdrawn, penalty up to ~25% of $7,843 ≈ $1,960

8. Key Statistics & Charts

• 2025 401(k) contribution limits: up to $31,000 (plus $11,250 extra for age 60–63). 

• RMD age increased from 72 to 73 in 2023; to 75 in 2033. 

• Penalty reduced from 50% to 25% for missed RMDs (correctable to 10%). 

🔢 Life Expectancy Factors (approx.)

• Age 72: 27.4

• Age 73: 26.5

• Age 74: 25.5

📊 Consider adding a simple line graph showing evolving contribution limits with age.

9. Practical Tips for Managing Your 401(k) After 70

1. Keep working if you want to delay RMDs.

2. Max out your contributions—including catch-ups.

3. Watch your RMD schedule: mark your calendar!

4. Plan for tax impact: big RMDs can affect Medicare and your bracket.

5. Use Roth conversions: shift taxable money into Roth IRA for tax-free growth.

6. Use Qualified Charitable Distributions (QCDs) if you’re charitably inclined. 

7. Review your 401(k) plan—check if employer allows RMD deferral.

8. Stick to penalties: if you miss an RMD, file IRS Form 5329 and request relief. 

10. Conclusion

Turning 70+ doesn’t mean the end of your 401(k) power—it often brings new opportunities for growth and tax planning. By understanding contribution limits, RMD rules, and planning ahead, you can make your savings work smarter in your golden years. Stay informed, stay proactive, and stay confident!

11. FAQs

Q1: Can I still contribute to my 401(k) after age 70?
Yes—if you're working, traditional and Roth 401(k) contributions are allowed with no age cutoff. 

Q2: What age do RMDs start?
Generally at age 73 for those born in 1951+. It jumps to 75 for those born in 1960+ (2033 rule).

Q3: Can RMDs be delayed if I’m still working?
Yes—if you work past 73 for an employer where you own <5%, you can defer 401(k) RMDs until you retire. 

Q4: What’s the penalty for missing an RMD?
25% of the missed amount (correctable to 10%).

Q5: Do RMDs apply to Roth 401(k)?
Yes, Roth 401(k) plans face RMDs starting at the same age unless rolled into a Roth IRA. After death, Roth IRAs are exempt until inherited. 

12. 📞 Call to Action

Need help with RMD calculations, tax-smart withdrawal plans, or filing support? Contact Manika Fintax Solutions today for personalized, paid filing assistance—and secure your financial peace of mind in retirement. 👇

[Contact Manika Fintax Solutions]

This guide is designed to be friendly, professional, and easy enough for beginners—ideal for Learn with Manika to help learners make confident financial choices after 70