Retirement Planning/401K after 70 1/2 rollover?


Hello Richard,

I'm 72. I retired when I was 69, and haven't worked since. Before turning 70, I contacted several times my ex-employer's HR and the investment company that holds my 401K, and asked them what should I do about the 70 1/2 distribution in order to avoid tax penalties, but they said I had to do nothing, but now I got a distribution from the fund. They're keeping almost $200 tax from approx. $900 distribution, so I'm getting only about $700.

What I'd like to do is get the money out and move it to either an IRA or Roth-IRA, but all the information I find about doing so, talks about people at a younger age. At my age, what would be the pros and cons of a rollover to an IRA vs a Roth-IRA?

Thanks in advance,


The Financial Quarterback
The Financial Quarterb  
Thanks for your question and I hope that I am able to provide a little info. First, I really can't comment about your 401k or your distribution. I would have to have some more information in order to provide you better information.

As far as a traditional IRA is concerned, a rollover into a traditional IRA can be done at any age. I always recommend the rollover into an traditional IRA because of the many benefits and flexibility offered with an IRA. You are able to transfer this 401k into an traditional IRA and set up your required minimum distribution with that custodian. Your rollover would be into a traditional IRA. You may open a Roth IRA at a future date and begin converting your funds into a Roth, however, there are many things to consider when doing this so I would not do it without working with an advisor who can provide greater insight.

Let me remind you that Required Minimum Distribution rules are tricky and expensive if you screw up. Especially the fist one and when combining other qualified plans. Please make sure to seek advice from a Certified Financial Planner in your area which can review your individual issues and goals and go over your options.  

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Richard E. Reyes, CFP


I can provide answers to questions relating to retirement especially relating to; income distribution, tax efficiency, long-term care insurance, life insurance, estate planning, asset protection, variable and fixed annuities, alternative investments and prudent portfolio design.


Through the years Richard has built a reputation as one of Central Florida's expert on retirement income distribution by providing sound, unbiased wealth coaching. We believe that Financial Planning is the problem and Wealth Coaching is the solution. The Wealth Coaching process gives you Peace of Mind, so you can stop worrying about your future. It helps you find happiness as it guides you in the TRUTH of investing, by teaching you how to make wise choices as you journey through your life’s stages. It is all about your relationships and what you value, not your net worth.

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B.S. University of Florida, Gainesville, FL
CFP Certificate, University of Central Florida, Orlando, FL

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