You may spend decades contributing to your IRA and 401(k), but eventually you’ll need to use this money. Before that day arrives, you’ll want to be familiar with the rules governing withdrawals – and you’ll want to know just how much you should take out.<span class="Apple-converted-space">&nbsp;</span>

To begin, withdrawals from traditional employer-sponsored retirement plans like these fall under the Internal Revenue Service’s “required minimum distributions” (RMD) guidelines. (You aren’t required to take these distributions from a Roth IRA.) Here are some of the key RMD points to keep in mind:<span class="Apple-converted-space">&nbsp;</span>

• You need to take distributions by age 70 1/2. You generally should begin taking RMDs in the year in which you turn 70 1/2. If you don’t take your first RMD during that year, you must take it no later than April 1 of the following year. If you put it off until April 1, you must take two distributions in one year. <span class="Apple-converted-space">&nbsp;</span>

If you don’t take your RMDs on time, you may have to pay the IRS a 50 percent penalty tax on the taxable portion of your uncollected distribution — so make sure you know your dates. <span class="Apple-converted-space">&nbsp;</span>

• You can take more than the minimum. You can withdraw more than the RMD, but as the word “required” suggests, you can’t withdraw less.<span class="Apple-converted-space">&nbsp;</span>

• You may be able to delay RMDs in an employer’s retirement plan if you’re still working. If your employer’s retirement plan permits it, you may not have to take RMDs if you are still working and you are 70 1/2 or older. However, this exception won’t apply if you own 5 percent or more of your company. <span class="Apple-converted-space">&nbsp;</span>

To determine your RMD, you’ll need to use either the Uniform Lifetime Table, which is based on your life expectancy, or the Joint Life Table, if you have a spouse who is the sole beneficiary and who is more than 10 years younger. Your tax advisor can help you make this selection.<span class="Apple-converted-space">&nbsp;</span>

Now that you know the basic rules of RMDs, you’ll need to consider their impact on your retirement income. As mentioned above, you can certainly take out more than the RMD, but should you? <span class="Apple-converted-space">&nbsp;</span>

If you need the extra money, you’ll have to take it. However, when determining how much you should take beyond your RMDs, you’ll need to weigh some other factors. <span class="Apple-converted-space">&nbsp;</span>

For one thing, if you can delay taking Social Security, you’ll get bigger checks, so you might be able to lower the amounts you take from your 401(k) and IRA. <span class="Apple-converted-space">&nbsp;</span>

Another factor to consider is the size and composition of your investment portfolio held outside your retirement accounts. If you have a sizable amount of investments, with some of them providing regular income, you may be able to afford to take out only your RMDs, or perhaps just slightly more. On the other hand, if your 401(k) and IRA make up the vast majority of your investment holdings, you might need to rely on them much more heavily.<span class="Apple-converted-space">&nbsp;</span>

In any case, though, you will need to establish an appropriate withdrawal rate for all your investments to ensure you won’t outlive your money. A financial professional can help you calculate this rate.

Do whatever it takes to maximize your benefits from your IRA and 401(k). They’re valuable assets – so use them wisely.<span class="Apple-converted-space">&nbsp;</span>

<i>This article was submitted by Brandon M. Cox, CFP, Financial Advisor at Edward Jones. Member SIPC</i>