The Wall Street Journal’s “Ask Encore” by Kelly Greene gives the answer.

As you know, at age 70 1/2 you must take your required minimum distribution (RMD) by April 1rst of the following year and then every year no later than December 31st. As Greene notes, some retirees will take their first distribution during the year they turn 701/2 to avoid taking two distributions following the year they become 70 1/2.

Many workers, age 70 1/2 and older continue working so they keep adding to their 401(k) plan. As long as the worker keeps working and contributing, there is nothing requring a distribution until April 1st the following year of their retirement.

Here is the rub if you own 5% or more of the company: you must begin distributions at age 70 1/2 even though you continue working.

If you have other retirement plans, you must begin taking distributions from them at age 70 1/2. If not, you face up to a 50% penalty on the value of the amount you should have withdrawn from those accounts.

IRS Publication 590 will answer many questions.

BankRate.com gives you further details about your retirement distributions.

If you need help calculating your required minimum distribution, send me a request by completing this contact page.

Here’s the formula if you want to complete the calculation yourself. Check your retirement account balances as of December 31st of the year prior to the year of your distribution. You’ll need the IRS Uniform Lifetime Table to get the age-based factor for your calculation. The age on your most recent birthday (starting at age 70 1/2) will tell you the age-based factor you will use.

Cars need tires. My 1950 Chevrolet convertible with Dynaflow needed tires in 1965. Recaps worked; they met my high school budget, and worked. Makes me wonder if recapping is better than retiring.

Television advertisements offer services and products for retirement. You can retire to the beach or the bedroom. Or, you can start a recap of your life.

My recapped tires needed new tread; recapping does that. Recapping your life stages makes more sense than retiring.

Ashley Kahn, wrote “The House That Trane Built: The Story of Impulse Records”. You can hear him on National Public Radio (NPR).

In the Wall Street Journal article (January 10, 2007), “A Cultural Conversation with Jerry Wexler”, Kahn celebrates Mr. Wexler’s 90th birthday (January 10th). Mr.Wexler receives accolades for his “role as producer and former president of Atlantic Records”.

Anyone ninety years old suffers the loss of friends and family. You can read all about his career in the article. What strikes me is his memory and preservation of his past, but no interest in what happens in the music industry today. “In what way could it possibly engage me? I’m not involved in it.” He is not retired; he is recapped.

Kahn visited Mr. Wexler’s home; he observed Jerry Wexler moving “…briskly from room to room, and from task to task.” Life is not over. Wexler exhibits drive and purpose. “Everybody seems to be coming to my door; BBC, NPR.”

Here is the lesson for all of us, “…there aren’t too many people at the age of 90 that are coherent or even alive.” Life provides perpetual opportunity to act, to do, to live. The past is behind; we are presented with “now” not to retire, but maybe just to recap for new trips forward.

Whether rich or less-rich, leave the word “retirement” in the dictionary.

Scott Burns, columnist for the dallas/”>Dallas Morning News writes about the “retirement algorithm” in his Boston Globe article, “Couples may need less than they think to retire”. I never liked math, but it makes such sense, as my math teachers have reminded me.

Burns states that “… the cost of a household rises as the square root of the number of members.” You can Google square root calculations for your household. We have five members of our household. Using the retirement algorithm, the cost for one person is “1″. You might think the cost of two would be “2″. Nope; it is the square root of 2, and that is 1.41 ( or 1.41421356 to be exact). For our family of five the cost for five is 2.2. We have one relative living with us; best not tell the others that we could add a few more without much more expense.

The point of Burn’s article is that you can live less expensively during retirement. You will have to pay off the mortgage, and you will have to keep adding to your 401(k)during your work years.

When I first became a stock broker, a major Wall Street firm trained me in New York City. At the end of classes, I waited in the lobby for my ride. As executives fled the building, a group of older workers walked in the lobby. They headed for the elevators. I asked someone, “Where are they going?” These folks emptied the baskets and sorted mail. They had retired from their life’s work, but needed the money. For some, the retirement algorithm does not matter.

Read some of my other articles found as Ethos Musings