Boomer Benchmark Presents IRA Puzzler

The upside is that, hopefully, by 59-and-a-half, big expenses such as college tuition and mortgage payments are down to a minimum. Hopefully you're pretty close to being able to just worry about yourself (and your daily tee times). Even still, make sure you'll have enough money. I don't have to remind you that with so many Boomers set to retire over the next 20 years, Social Security is clearly not going to be your answer to living large.

For a quick estimate on how much you'll need to retire, check out the American Savings Council's retirement calculator. But for a more detailed calculation that allows you to input plenty of variables, try the retirement income calculator on the T. Rowe Price Web site. "It comes the closest to giving you the depth you need to get a good number," says Carlson.

So run the numbers and start socking some cash away.

Go Through Withdrawal

On the flipside, there are some sound planning reasons to start withdrawing from your IRA sooner vs. later.

If you have a very large IRA as the result of, say, a 401(k) rollover from a previous job, you might consider pulling some money out.

Here's why. At age 70-and-a-half you're required to start taking out a minimum amount of money each year -- a.k.a., your minimum required distribution. So the larger the amount of the IRA, the larger the minimum required distribution (the actual amount is based on a big actuarial formula) and therefore the tax bill. To lower that tax hit in your later years, think about pulling some of it out now and your minimum required distributions will, in turn, decrease later on.

Remember, your IRA withdrawals will be subject to ordinary income tax, which could hit 35% if you make enough money. And that could be a big nut to crack in your old age. But by paying the tax now, while you're still working, the tax hit might not be as painful.

Even better, if you then put that IRA withdrawal in a taxable investment account and leave it alone, you'll only owe the 15% long-term capital gains tax on the appreciation when you finally need the money in retirement, says Rande Spiegelman, vice president of financial planning at the Schwab Center for Investment Research. So it might make sense to pay some extra tax now as opposed to when you're 70-and-a-half.