S2E10 | Secure Act 2.0
“You can start thinking about it [SECURE 2.0] and maybe start talking to your advisor about what the implications might mean for you and setting up some contingent plans… What separates us from some other advisors is we are a CPA and a wealth management firm. Financial planning is the backbone of what we do.”
Solidifying your retirement plan is one of the most important factors in financial planning. In this episode, Sachetta Callahan financial advisors Joseph Sachetta, Matt Stead, and Mike Callahan discuss the Securing A Strong Retirement Act (SECURE 2.0), currently working its way through congress and expected to roll out within months.
The impending Securing A Strong Retirement Act has been dubbed SECURE Act 2.0, after it’s wide-reaching predecessor, the SECURE Act 1.0, which changed the distribution timelines for those inheriting an IRA (beneficiary is now required to liquidate the account by the 10th year following the death of the IRA owner), Required Minimum Distribution (RMD) age, and expanded retirement plans for part-time workers. The new SECURE Act 2.0 is expected to have an equally broad outreach with some similar changes. Planning for the possible changes to legislation can help eliminate surprises and secure retirement ahead of the SECURE Act 2.0 rollout.
In the new SECURE Act 2.0, financial advisors speculate that the RMD age will be increased again, maybe to age 75. Those relying on distributions will still be able to access the funds, and for those who don’t, this age extension provides an opportunity to consider their financial plans and taxes before receiving distributions. Auto-enrollment in retirement plans are also expected to be expanded in the new Act. This is intended to reduce the number of people who end up without a retirement plan due to not completing the enrollment process. The last big change with SECURE Act 2.0 is inflation-indexed catch-up retirement payments. Catch-up payments have allowed people in their late 50s to contribute an extra sum of money to their retirement funds depending on their 401k and IRA, and with these new changes, will ensure that maximum contribution limits keep up with inflation levels.
We’re Here to Help
Having a financial plan that helps you plan for retirement as legislative changes are enacted is essential to achieving retirement goals. We’re here to help. Reach out to the financial advisors at Sachetta Callahan today.