If you're still working, you can contribute the full amount of your salary deferral to a Roth 401 (k), regardless of your age. Keep in mind that those who are 70 and a half years old or older and make contributions to a traditional IRA, a SIMPLE IRA, or an SEP IRA will continue to have to apply for an RMD, even if they are still working. Jeffrey Levine, an expert in tax and financial planning, described traditional IRA contributions after the RMD era as something like a revolving door of IRA money. Traditional IRA contributions later in life can also make sense if the person earns too much to contribute directly to a Roth IRA; in that case, the taxpayer can take advantage of the clandestine Roth IRA maneuver, fund the traditional IRA, and then convert it to Roth.
Although earned income is required to make an IRA contribution, income limits apply to IRA contributions regardless of age. However, while Roth IRAs or corporate retirement plans tend to be better receptacles for additional contributions from older workers, a traditional IRA may be appropriate in a handful of situations. The contribution limits for traditional IRA contributions that you can deduct on your tax return are the strictest; Roth IRA contributions are allowed with a higher income limit. However, despite the fact that the Security Act raises the age limit for traditional IRA contributions, IRA contributions continue to have restrictions.
Roth IRAs have no age limits for contributions, and workers can also contribute to their company's retirement plans (such as 401 (k) plans) and delay the RMDs of those accounts, as long as they are still employed and are not the primary owners of the company. However, you can still contribute to a Roth IRA and make cumulative contributions to a Roth or traditional IRA, regardless of your age. In addition, traditional IRA investments benefit even less from that tax-protected capitalization than contributions to Roth IRAs, since traditional IRAs are subject to RMDs that are ultimately subject to taxation.