A bill that has passed the U.S. House and Senate, and which is expected to be signed by the President, allows taxpayers to not take their Required Minimum Distributions out of their IRA’s or other retirement accounts in 2009.

Typically, in the year when a person who has IRAs or other retirement accounts turns 70 ½ they must begin to take Required Minimum Distributions (RMD) from those accounts.   Each year thereafter they must take a slightly larger percentage of their assets out of those accounts.   If the person with the IRA doesn’t take their RMD, they are assessed a hefty penalty.   The bill that recently passed the U.S. House and Senate, H.R. 7327, eliminates the penalty for not taking a RMD in 2009.   The intent of HR 7327 is to help taxpayers by not forcing them to withdraw money from their retirement accounts which may have lost significant value because of the recent downturn in the economy.   Additionally, people who were subject to the “five-year rule” for withdrawals, and are within their “five years,” will not be forced to withdraw funds in 2009 and the timeframe to complete their withdrawals will be extended by one year.

This law provides and opportunity for people who don’t need to take an RMD, but are required to because of their age, to allow their retirement accounts to recover during 2009 before taking their required minimum distributions again in 2010.   Please remember this important change before determining whether or not you will take money out of your IRA or retirement account in 2009.

Lastly, this change is only for 2009, not for this year, so don’t forget to take your RMD for 2008.

There’s good news and there’s bad news. The good news is that modern medicine and healthier lifestyles mean that we’re leading longer lives. In fact, life expectancy in the United States is starting to push 80 years of age. As recently as 1970, that expectancy was 70.8 years of age.

The bad news is that we are in danger of outliving both our money and our ability to care for ourselves. Recent turmoil in the stock market, where many retirees are heavily invested, has only highlighted the anxiety felt by seniors who fear they will run out of money, an issue explored in this article from Reuters news service.

Good estate planning needs to cover what will happen when you die, but also needs to take into account what will happen if you don’t—at least anytime soon.

Our culture is full of idioms like the one in the title, idioms that we take for granted until something like the mortgage crisis and rapidly dwindling stock market puts it all back into perspective for us.

The current financial crisis has touched all of our lives, but perhaps nobody has been hit quite so hard as retirees and workers who are nearing retirement age. These are the people who have been saving for years for retirement, only to watch it all dwindle away as the market falls, with no end in sight. It wouldn’t be quite so painful if they had years to recover, to wait for the markets to rebound; but they don’t. These are the people who are only a year or two away from retirement, or in some cases already retired and making withdrawals from their savings plans.

Many in this situation will have to put off retirement, working 2-5 years more with the hope that their investments will recover in time. But a luckier few will be able to weather the storm, and perhaps learn from it. Emily Brandon’s article, How to Retire During a Financial Crisis, addresses this issue, and gives readers some suggestions on how to prepare for a market downturn, making it possible to come out on top even if you are close to retirement (or already retired) when tragedy strikes.

We have a lot of posts on our blog about retirement issues; planning for it, saving for it, protecting it.  But what if retirement could be not just an ending, but a new beginning?  What if retirement was your opportunity to decide anew “what you want to be when you grow up?”

Many new retirees are doing just this, turning retirement into an opportunity to do the thing they’ve always wanted but were afraid to try.  Choosing a second “encore career” is attractive to retirees for a number of reasons, not the least of which is that it takes the pressure off of their retirement savings.

Due to healthier lifestyles and better healthcare, many people who reach retirement age aren’t so much ready for retirement as ready for change.  After years of working their way up in a career that helped pay the mortgage and put the kids through school, they yearn to spend their Golden Years doing something more personal.  For some people that means doing something philanthropic, many others see it as an opportunity to do something creative.

Even with a lifetime of experience behind them (much of which will prove helpful in a second career), there will always be a transition period into any new venture.  Kerry Hannon’s article in U.S. News and World Report entitled 6 Tips On Planning A Second Career addresses just that issue.  In the article, Hannon gives practical advice that may have been forgotten after years of working in the same company, advice such as “connect with a network”; as well as more specialized advice such as “upgrade your education or skills.”

One thing is for sure, retirement doesn’t have to be the same thing for all people anymore.  Whereas for some it will mean a condo on the beach in Florida, more and more people are choosing to use it as an excuse to rediscover the profitability of their joys.

What will the future hold for you?