Here's What You Can NOW DO at Age 70 | Most Missed Opportunities

Añadido: 2026-05-28

[00:00:00]In this video, we talk about seven things that you can start to do or no longer can do once you reach age 70.

[00:00:06]Coming up next on Holy Schmidt.

[00:00:09]>> Holy Schmidt.

[00:00:13]>> Hey gang. The financial services industry has trained us to think that there are two really important dates surrounding age 70. Age 65 when Medicare begins and age 73 when required minimum distributions are due to start. At least for most people watching this video. But there's one date that doesn't get covered and it should and that is age 70. The fact is age 70 is when a lot of decisions actually concentrate. In fact, there are seven of them and most people don't even think about it because they're focused on these other key marquee outcomes at 65 and 73. So, in this video, I'm going to walk you through all seven. What you should do if age 70 is coming up. What you should do if age 70 is in the distance. And what you should do if age 70 has already passed. All right, let's jump into it.

[00:01:02]Let's start with the one that most people think about when they think about age 70. Delayed retirement credits and social security. At age 70, your social security payment stops growing. If you wait any longer to collect than age 70, you won't experience growth the way that you did from age 62 to age 70. that growth is a hard stop. Once you turn age 70, waiting won't add another dollar to your social security payment. This means that the math on filing is very simple.

[00:01:29]You need to file by the time you turn age 70 because if you don't, you're just leaving money on the table. You're not getting any benefit whatsoever. The second age 70 milestone happens 6 months later, 70 and a half, and that's when your qualified charitable distributions are allowed to start. Let me explain.

[00:01:47]The fact is the money that comes out doesn't show up on your tax return at all. It's not part of your adjusted gross income. It's not part of any type of income. It's just not reported as income on your tax return. Now, when you compare that to a regular charitable donation, in order to claim that charitable donation, you need to itemize on your tax return. And the fact is, most people who are age 70 and up claim the standard deduction. So they get no benefit from a charitable contribution whatsoever. A QCD works regardless because it never shows up as income in the first place. So there's nothing to deduct. Now there are two restrictions you need to know about. The first is that the charity needs to be a qualified 501c3.

[00:02:30]Donor advised funds and most private foundations don't qualify most of the time anyway for a QCD. The QCD needs to go directly to the operating charity.

[00:02:40]Now why do most people miss this?

[00:02:42]because of the 70 and a half thing. The tax code has cleaned itself up a lot lately and these half years are rare. 59 and a half, 70 and a half, but that's almost all of them really. Everything else has been rounded up to the nearest whole year. Gang, how prepared are you for retirement? Really, the fact is most people think they're more prepared than they really are. I've put together a 15 question quiz. Takes about 2 minutes so that you can see exactly where you stand in 15 key areas of retirement readiness.

[00:03:13]And it's absolutely free. No credit card, no phone number, nothing like that. If you're interested in taking the quiz, go to holymidt.com/quiz.

[00:03:22]You can take the quiz and you get a free 12-page report at the end, absolutely free. The third milestone isn't something that fires off at age 70, but it is the beginning of the end of a window that you've had open for required minimum distributions. That happens for most people watching this video at age 73 or 75 if you were born in 1960 or later. Let me explain. RMD's required minimum distributions are the amounts that you need to take from your retirement accounts at age 73 for most people. They're not optional. You need to take them. And the reason you need to take them is because the IRS wants the tax. To be completely candid, they don't want you hoarding money in an IRA. And then years later, you finally take the money out when the tax code is either more favorable or something else has happened. They want you to start taking required minimum distributions so that they can capitalize on the tax on the growth in your IRA or your 401k. By the way, if you were born in 1960 or later, your start date is age 75, not age 73.

[00:04:29]But the same basic concept applies. At age 75, you need to start taking withdrawals from your IRA or your 401k.

[00:04:37]What does this mean in practice? Well, this window 707172 is the cheapest window many people are going to have to do Roth conversions before RMDs kick in. Every dollar that you convert from an IRA to a Roth IRA is the current year's tax rate. And think about it, as I mentioned before, for a lot of you, for most of you, this tax rate is lower than you've seen in the past. And once RMDs begin, it may be lower than what you'll see in the future. RMDs add a permanent floor of taxable income to your tax return every single year from age 73 onward for most of you. Roth conversions then stack upon that which increases your tax rate even further. So now is the time for a lot of you to do the Roth conversions while you still have time. Anecdotally as RMDs begin you might get pushed into a higher bracket and that higher bracket might cause an Irma searchcharge where you didn't have one in the past. Point number four is what we just talked about the Medicare Irma search charge. At age 70, what you earn then locks in your Medicare sir charge at age 72 and frankly age 71 locks in 73 so forth and so on. The important thing to note that this milestone is a quiet one and most people don't even know it exists but it shapes your Medicare premiums for years to come. Medicare Part B and Medicare Part D premiums are means tested. They use a system called Irma, the income related monthly adjustment amount. If your income is above certain thresholds, your monthly premium goes up. And here's the trap. Irma looks at your income from two years ago. So the Irma sir charge that you pay in 2028 is based on your modified adjusted gross income from 2026. And candidly, if someone didn't know this rule or didn't rise level of consciousness, they knew it, but they didn't think about it, it's a big surprise that they don't see coming. And the fact is, Irma works in tiers. Once your income crosses a threshold, you move into a higher premium bracket for both part B and part D. It's not a smooth phase in. You step up to the next tier. If you're interested in a calculator that determines your Irma searchcharge, I have one on my website.

[00:06:50]Simply go to holymid.coma calculator. Irma calculator. No need to stop the video now, by the way. I will remind you at the end. So, this is important to keep in mind when you're doing Roth conversions so that you don't actually push yourself into a higher Irma bracket. Now, there is an escape hatch that the SSA has. It's a form called SSA-44 that lets you ask for a reconsideration based on what they call a life-changing event. Things like ending employment, marriage, divorce, or the death of a spouse can often qualify. But here's the catch. onetime income events don't qualify. A Roth conversion doesn't qualify. If you sell your home and you have a big capital gain, that doesn't qualify, although there is a separate exemption with home sales and so you have additional buffer there. What this means is that you need to really know your numbers during that Roth conversion window from age 70 to 72 to make sure that you don't push yourself up into the next Irma bracket. The fifth milestone is one that's a little bit harder to talk about, and that is any remaining long-term care options at age 70 effectively become unavailable past that point. And leading up to age 70, people have lost many of them already. And the policies that are available post age 70, they're two to three times more expensive than the same policy at age 60. Underwriting also gets significantly stricter at age 70. conditions that would have been a non-issue at age 60, like controlled high blood pressure, controlled diabetes, a prior cancer history, certain memory or cognitive screening issues can become disqualifying at age 70. So, even if you can afford the premium at age 70, you might not be able to get the policy at all. There are two alternatives to think about. One is a hybrid life insurance policy with a long-term care rider.

[00:08:43]These are sometimes available all the way up to age 80, though the pricing can be prohibitive. The second is self-funding. Setting aside a certain amount of your investable assets for long-term care expenses, at least potential long-term care expenses.

[00:08:58]There's no single right answer here, but the window is starting to close after about age 70. The sixth milestone is more of a checkup at age 70, and frankly, it doesn't cost much. If anything, it really is just focusing the mind to do a review of your estate plan.

[00:09:15]Here's the math, and here's why this matters. If you've reached age 70 and you're a man, your expected lifespan is another 14 years, age 84. If you're a woman, your expected lifespan is another 17 years, i.e. age 87. Of course, because this is an average, people fall on either side of those ages. But it's useful simply because it's data. And with data, you have a clearer picture of what's possible. But what it does mean is that the estate plan that you set up decades ago for many of you is likely to play out in the next 10 to 15 years, hopefully longer. Now, there are three very specific things that you want to check. The first are your beneficiaries, and these are the beneficiaries on your 401k, your IRA, your life insurance policy. The beneficiary designation on those accounts overrides what your will says, what your estate plan says. If it's directly on the asset, that takes precedence over anything else. If you got remarried, divorced, or one of your beneficiaries died, the wrong person could inherit your retirement account, and the time to find that out is not after you're gone. Second, transfer on death or payable on death designations on your brokerage account. The same rules apply. Pull a recent statement and see who's listed. If you haven't reviewed this in say 10 years, you might be surprised at who's listed on that account. And the same thing applies, by the way, with your bank accounts, your savings account, your checking account, any other account you have at a bank.

[00:10:43]Third is your trustee. If you have a trust set up, then the person you designated as the trustee may have died, retired, something could have happened where maybe they just don't want to do it anymore. I don't know. But check to see who your trustee is. A trust without a trustee is a problem your family will have to deal with at the worst possible time. Point number seven, the Social Security survivor benefit just locked in at its maximum if you haven't taken Social Security. Once you claim Social Security at age 70, that is the maximum possible Social Security survivor benefit. And the survivor benefit isn't one that most people think about. People pass and they don't even think about the survivor benefit. It's actually really a shame. But at age 70, the maximum possible survivor benefit is available to your surviving spouse. And for those of you who don't know, here's how the Social Security survivor benefit works.

[00:11:38]The higher earner, the higher primary insured has a higher benefit than their partner. That benefit is transferred to their partner when they pass. This includes delayed retirement credits, which means that if they waited until age 70, the survivor gets 124%.

[00:11:58]If we're talking about a full retirement age of age 67, they get 124% of the primary insurance amount that gets transferred right to the survivor haircut for their own age if they're under full retirement age. And if they haven't filed at all, then if they're under full retirement age, the SSA assumes that they were going to be full retirement age and gives the survivor the full retirement age benefit, the whole 100%. If they were between full retirement age and age 70, then the date of passing becomes the date at which they would have filed for social security, so something larger than 100%.

[00:12:34]Here's something to note. The survivor can't have both their spousal benefit or their own benefit and the survivor benefit. They can only get one. So, they're immediately going to lose a portion of their income or at least potential income if they haven't filed for their own benefit. So, the survivor is only going to get one benefit, not two, had the deceased not passed, then there probably would have been the primary insurance amount in either a spousal benefit or the survivor's own benefit. So, two income streams from social security. Unfortunately, the survivor only gets one. The second is that tax brackets change. Previously, the couple was married filing jointly.

[00:13:13]Now, the survivor is single. It affects not only taxes, but also the Irma searchcharge, if there is an Irma searchcharge. Now, here's the big takeaway to all of this. Age70 is not the gentle birthday the financial industry talks about. It's a milestone year where Social Security crystallizes and tax planning windows start to narrow. Medicare premiums get locked in for two years out and insurance options start to close. Most of these reward you if you pay attention to them now. If you wait well then the odds change. If you like this video, check out that video, the Roth 5-year rule trap that most retirees miss. Finally, if you want to try our Irma calculator, go to holy.com calculator. This is Jeff Schmidt and I will see you in that video right