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What Will The SECURE Act Mean For My Retirement Plans?
What Will The SECURE Act Mean For My Retirement Plans?

What are your retirement plans? Have you thought about how you will pay for your housing situation? Have you reserved enough money for extra expenses? Will the retirement age change by the time you retire? All of these questions are valid and you should take them into consideration as you grow older. With policies changing regularly, it is critical to stay up-to-date to be prepared for any situation.


In 2019 the senate will decide whether they approve the changes for the current retirement requirements or if they will make any changes at all. With the House of Representatives already approving the Setting Every Community Up for Retirement Enhancement Act (SECURE Art), the requirements for new retirement plans will change. If passed, you can expect some changes to be:

  • More part-time positions offering 401(K) plans
  • Contribution to traditional IRA’s (Individual Retirement Arrangements) for as long as desired
  • Penalty-free withdrawals for those who fall into specific groups/circumstances
  • The age for retirement to move from 70 ½ to 72 years of age
  • A requirement to withdraw from inherited retirement accounts within 10 years of retiring


Retirement should be an exciting time, away from confusing language and ever changing politics. For this reason, The Law Offices of Joel A. Harris works hard to provide you with information to make it easier for you to understand the new changes the SECURE Act brings. We are located in Concord, Walnut Creek and Antioch, to be most convenient to our clients. If you would like to visit us in person, by phone at (925) 757-4605 or via website, feel free to contact us and we will be more than happy to help!

What Changes Will I See?

There are quite a few changes that you can expect once the SECURE Act is passed and put into practice. Below are a few changes that you can expect and how you can prepare for them to better your retirement experience:

  • Part-Time 401(K) Options: There is currently a minimum number of hours worked in one year (~1000 hrs.) that decides if a worker is eligible for a 401(K) account. With the SECURE Act part-time workers will become eligible for a 401(K) account, so that they can start adding funds to their future income. If you would like to read more in detail about this change, go here.
  • Inclusion of Academic Income: At the moment, certain academic stipends and non-tuition aid are not treated as income for purposes of IRA contributions. With the SECURE Act in place, these kinds of aid and financial support will be included as a form of income. This means that higher taxes may be paid, but more money may be taken out when needed. If you would like to read more about this, check out this article
  • Removal Of Age Limit For Contributions: The SECURE Act would remove the current age (currently 70 ½ years old) restriction to contribute to a Traditional IRA. This change can be seen as a positive change since the age of retirement may change over time, which would affect the age restriction. If you would like to learn more about this, we recommend that you read this article.
  • Limitations on Tax-Advantages After Death: A benefit that was available to families in the past has been the inheritance of retirement funds. This option became popular in the 1960’s and can still be seen today. With the SECURE Act in place, family members who benefit from retirement inheritance may find themselves with stricter time limits on both the time it takes to withdraw the money, as well as how much can be withdrawn at one time. If you would like to read more, you can go here.
  • Penalty-Free Withdrawals for Birth or Adoption of Child: The changes to the SECURE Act would allow new parents, biological or adoptive, to take up to $5000 from their 401(K), IRA or other retirement accounts. This new change is beneficial for parents since there is also no limit as to how many times a future retiree can use this benefit. It is important to state that new parents should take into consideration their future retirement costs. If you would like to read more about penalty-free withdrawals,, read this article.

What Should I Do Now?

If you are planning to retire shortly or have yet to plan for retirement, The Law Offices of Joel A Harris, located in Concord, Walnut Creek, and Antioch are available to help you plan accordingly. Joel Harris is an attorney with nearly 30 years of experience in estate planning, trust and probate law. Joel works with expert tax and financial planners who can take the time to help you plan for retirement, create a budget, document progress and provide useful reminders pertaining to your personal retirement plan. If you are not sure how to begin planning for retirement, feel free to visit us online, in person or by phone at (925) 757-4605. Our priority is your future success!

Sources

  1. https://www.creditkarma.com/insights/i/proposed-secure-act-changes-for-retirement-savings/
  2. https://www.kiplinger.com/slideshow/retirement/T047-S001-how-the-secure-act-could-impact-retirement-savings/index.html
  3. https://www.forbes.com/sites/simonmoore/2019/06/27/secure-act-ira-resa-stretch-ira-estate-planning/#505fdc3335c9
  4. https://money.usnews.com/money/retirement/iras/articles/what-is-the-secure-act

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