As a CERTIFIED FINANCIAL PLANNER™ I’ve always gotten a lot of questions from friends and family about financial issues. Lately, though, the popular topic seems to be the new SECURE Act legislation. Enacted in December 2019, the SECURE Act made some of the most sweeping changes we’ve seen in years to retirement plans.
As much as I’d like to have a one-size-fits-all, simple response, the changes enacted by the SECURE Act are highly specific and individual for each person. It’s a little like going to a doctor and asking them to locate a pain in your body. Rather, it takes an in-depth conversation with an expert about your individual situation and goals to pinpoint exactly how you should best position yourself and your family to take advantage of the SECURE Act.
This legislation creates plenty of opportunities, but also some drawbacks, particularly for beneficiaries of IRAs and retirement accounts. It is important to take advantage of the opportunities, but also to mitigate the potential downside. This may include some things that are outside your comfort zone, like a Roth IRA conversion strategy that requires you to pay more taxes now so you (or your beneficiary) pay considerably less later. Or you may consider taking advantage of the extra years you have been given before being required to take distributions from retirement accounts, while also saving more if you have the ability and desire to work past traditional retirement age. There may also be more optimal ways to support your favorite charities that you have not used in the past. No matter your circumstance, there is likely something for everyone in this legislation.
While I urge you to spend the time to consider your options, there is no reason to run out and make impulsive decisions without educating yourself first. While medical professionals often warn against researching medical conditions online, we encourage you to seek out more information about the SECURE Act. My colleagues and I crafted a guide called WHAT IS THE SECURE ACT? to help you understand the pieces of this legislation that are most likely to affect you and your family. A thoughtful review process will result in the best choices for you. When you feel comfortable, we welcome your questions and stand ready to assist your family with trust, estate, and private wealth services.