As long as you have generated W-2 income/earned income,, you are entitled to contribute to an IRA (Traditional or Roth). There is no age cutoff. Starting at age 72, however, you must begin taking taxable Required Minimum Distributions (RMDs) from your Traditional (pre-tax) IRA, even if you are still working and making IRA contributions.

Taxable RMDs from your employer-sponsored retirement plan (457(b), 401(k), 403(b)), also begin at age 72 if you are no longer working for the employer sponsoring the plan. For those, however, who are still working past age 72, your first RMD is due by April 1 of the year following the year of retirement.

Federal tax law does not compel the city to offer after-tax or Roth investing. The city has taken the position that you should be given a choice: pre-tax or after-tax or the use of both tax types. I enthusiastically advise everyone to invest their entire contribution in the Roth feature of the Deferred Compensation 457(b) and 401(k) Plans of the City of New York. Moreover, for those who are eligible, I also advise contributing as much as possible to the NYCE Roth IRA.

With that said, at age 72, Roth 457(b)/401(k) balances are subject to Required Minimum Distributions (RMDs). While the RMD is tax-free, the interest, dividends and profits the RMD generates are subject to income tax. This is why I advise upon separation from employment that you roll over your Roth 457(b)/401(k) balance to your NYCE Roth IRA where distributions are not required during the lifetime of the original owner of the Roth IRA.


  1. Contributions are made with after-tax dollars.
  2. Contributions may be withdrawn tax-free at any time.
  3. The earnings generated by the contributions may also be withdrawn tax-free provided the Roth IRA is at least five years old and the account owner has attained age 59.5.
  4. At age 72, the Roth IRA owner is not subject to Required Minimum Distributions.
  5. The Roth IRA owner need not make any withdrawals during his or her lifetime.
  6. 1-5 apply to the spouse beneficiary of the Roth IRA.
  7. A non-spouse beneficiary of a Roth IRA must empty out the account within 10 years of the death of the original account owner.

Of Note: The Board of Trustees of the Teachers' Retirement System's 403(b) savings plan has decided not to offer a Roth feature.

Mr. Frank is a fee-only Retirement Financial Planner and a retired city high school Teacher of Accounting. He can be reached by phone at (732) 536-9472, or via email at

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