NEW YORK (CNN/Money) - Now that my parents-in-law are 70 1/2, I understand that they're required to start withdrawing their retirement money from their IRA. How much do they need to take out each year?

-- Mike Slobodow, Greenacres, Florida

Ah yes, your in-laws have reached that stage of life where the government wants some payback from all the tax deductions on people received by making pre-tax contributions to 401(k) accounts and deductible contributions to IRAs.

The government does this through what are affectionately known as RMDs, or required minimum withdrawals people must begin making from their 401(k) and IRA accounts after they turn 70 1/2. (Roth IRAs, however, are exempt from this requirement.)

Your in-laws should be thankful that you're looking into this for them because withdrawing less than the required minimum can result in a stiff fine.

If they fail to withdraw at least the minimum, they must pay a penalty equal to 50 percent of the difference between what they should have withdrawn and what they actually withdrew. Ouch! Now that can really take a bite out of your retirement savings.

So how does one figure out what size withdrawals are required in a given year?

Well, it used to be that you practically had to be an actuary to calculate the required minimum. But the government has taken pity on our poor miserable souls so that now figuring the correct amount is merely a pain in the...neck.

Basically, there are two ways to go. One is to go to the IRS Web site and download IRS Publication 590: Individual Retirement Arrangements. There, in the IRS's own mind-numbing prose, you'll find all the regulations pertaining to RMDs, as well as a table which gives you a number to determine the required withdrawal for each age up to 115.

You just divide the combined balances of all your IRA accounts (excluding Roth IRAs) by this number and you have your required withdrawal. Note: A husband and wife would each do their own calculation separately if they're both over 70 1/2 and each own IRAs.

The second option is to go an RMD calculator, which you can find at a variety of Web sites.

Possible downsides to this approach: if the IRS changes the formula and the site doesn't update its calculator, you could withdraw the wrong amount. There are also a few potential wrinkles in the required withdrawal depending on your exact birth date and the age difference between the IRA account owner and his or her spouse.

Given the penalties involved, I don't think it hurts to go to the trouble of downloading the IRS publication once a year. But, hey, I'm a stickler about shelling out any more money than I absolutely have to the IRS.

As important as it is to make the required minimum withdrawals, however, I suspect that the problem most retirees (and perhaps even your in-laws) will face is not pulling too little money out of their retirement savings stash, but pulling out too much.

By that, I mean I think the bigger problem for most people is how to limit their withdrawals so that their retirement assets stand a better chance of lasting through a retirement that these days can last 30 years or longer.

Indeed, I think this issue of retirees managing their assets in retirement so they don't run out of money before they run out of time is so important that I devote a full chapter to that topic in my recent book, "We're Not In Kansas Anymore: Strategies for Retiring Rich In a Totally Changed World."

So, by all means, make sure that your in-laws don't run afoul of the dreaded RMD rules. But at the same time, it wouldn't hurt to make sure that they're not pulling money out so fast that they're going to find themselves with much more time to live but not enough money to make that time as enjoyable as it should be.

Walter Updegrave is a senior editor at MONEY Magazine and is the author of "We're Not in Kansas Anymore: Strategies for Retiring Rich in a Totally Changed World." He also answers viewers' questions on CNNfn's Money & Markets at 4:40 PM on Mondays.