If you will be entering the new year as a retired person, or plan to enter that new phase of your life in 2025, there are some things you should think about now to ensure you get off to the best possible start. Kipingler.com has some important tips to help you plan to get the most from your retirement in the coming year and beyond:
Social Security
Many retirees depend on social security when they retire. That’s why it pays to be strategic about when to claim your first check. If you’ve worked long enough to earn 40 credits, one credit equaling $1,730 in earnings, with a maximum of four credits earned each year, you can apply for Social Security as early as 62.
However, delaying your Social Security benefit from age 62 to 70 can boost your payout by up to 8% yearly. That alone can result in a 76-77% higher benefit at age 70. Another strategy, the 62/70 split, which works incredibly well for married couples, can also increase your benefit beyond delaying your benefit. In this case, the spouse earning the lower wage starts benefits at age 62, while the higher-earning spouse delays receiving benefits until 70. In turn, the higher earner receives a spousal benefit while waiting, increasing both their own and the potential survivor benefits for the other spouse.
To claim the full benefit you’ve earned based on your work history, you must wait until your full retirement age (FRA). Your FRA is based on your birth year… If you claim Social Security before your FRA, you could lose…You can also delay claiming Social Security beyond your FRA. In that case, your checks will grow by 1% per month. This ends when you qualify for your maximum benefit at 70…
401(k)s
The amount you can contribute to your 401(k) plan has increased from $23,000 in 2024 to $23,500 in 2025. The limit on annual contributions to an IRA remains at $7,000, and the IRA catch‑up contribution limit for people 50 and over will stay at $1,000 for 2025.
Effective for the 2025 tax year, active 401(k) plan participants aged 60 through 63 can contribute over $10,000 or 150% of the 2024 catch-up contribution limit (indexed for inflation) in a super catch-up as a result of SECURE 2.0 legislation. For 2025, the maximum catch-up contribution is $11,250. In 2025, the total limit for 401(k) contributions for anyone aged 60 to 63 is $34,750. That number includes the $23,500 contribution limit and a catch-up contribution of $11,250. If you’re an account holder, you can take advantage of this additional catch-up contribution before the end of the year.
IRAs
The base IRA contribution limit remains unchanged at $7,000 in 2025. However, the income ranges for determining eligibility have increased… Contribution limits on a variety of other retirement accounts will rise in 2025, including Roth IRAs, SEP IRAs, Solo IRAs and others. Details on these and other retirement-related cost-of-living adjustments for 2025 are in Notice 2024-80 PDF, available on IRS.gov.
Taxes
For 2025, the IRS made some changes and adjustments to standard deductions, tax brackets, earned income tax credits, contributions to health savings plans and more. Although only some of these changes will apply to your situation, if you plan to make a change, like getting married or divorced, it pays to understand these changes before the year ends…
Required minimum distributions (RMDs)
If you're required to take your required minimum distribution (RMD) from your retirement account, you'll want to do so before year-end to avoid paying a penalty. An RMD is the amount of money you must withdraw each year from your employer-sponsored retirement plans like 401(k)s and certain IRAs. You must take your RMD after you turn 73 years old and every year after that or face a tax penalty. RMDs do not apply to Roth accounts until after the account owner dies.
Maybe you got divorced or married, or your children are now adults. Maybe it’s as simple as your wishes changing over time, or you want to designate someone to manage your healthcare directives or finances. Whatever your reasons for updating your estate plan, doing so before the end of the year will give you the satisfaction of knowing your wishes will be carried out upon your passing.
You can find more details by reading the full article here.
Navigating retirement can be complicated. What you don’t want is surprises. Planning as much as you can in advance can make a difference. And when in doubt, it’s a great idea to consult a financial planner, who can help you make the decisions that are best for your situation.