SECURE Act: What does it mean for investors?



SECURE stands for: Setting Every Community Up for Retirement Enhancement

The SECURE Act has come into play as of January 1, 2020. The following are key changes brought about by this Act:

IRAs and Age Limits:

1. Elimination of the age cap for contributions to Traditional IRA Accounts. As long as you are still earning an income, you can contribute to a Traditional IRA indefinitely.**

2. The age at which Required Minimum Distributions (RMDs) begin has been increased to age 71.

**This only applies to individuals who turn 70 1/2 after December 31, 2019. If an individual turned 70 1/2 in 2019, the age increase does not apply.


IRAs and Inheritance:

1. IRAs inherited after January 1, 2020: Elimination of Stretch IRA for non-spousal account inheritors. This means non-spousal inheritors must distribute the inherited IRA within 10 years of receiving the inheritance.

    a. Exceptions to this rule may include:

    • Surviving spouses
    • Minor children
    • Beneficiaries not more than 10 years younger than the deceased
    • A beneficiary who is disabled
    • a beneficiary who is chronically ill

2. IRAs inherited prior to January 1, 2020 are not affected by this update. The 10 year rule applies only to accounts inherited in 2020 and beyond.


Employer-Sponsored Retirement Plans:

1. More employers can offer Annuities within 401(k) plans.

2. The SECURE Act broadens the ability for Multiple Employer plans for small businesses. This means employers can group together under one plan, without being within the same industry, to obtain a wider range of plan options.

3. The required number of hours worked per year for long-term part-time workers to qualify for contribution to their employer-sponsored retirement plan has been adjusted. The threshold is now 1,000 hours worked for one full year or three consecutive years of at least 500 hours worked per year.

4. A Tax Credit is available for employers that automatically enroll workers into the sponsored retirement plan.


Withdrawals from IRAs and employer-sponsored retirement plans:

1. New parents can now withdraw up to $5,000 from an IRA or an employer-sponsored retirement plan to pay for birth and/or adoption expenses up to one year after the birth or adoption. Taxes must still be paid on pre-tax contributions, but an early-withdrawal penalty will not be applied.


529 Plans:

1. Assets in 529 college-savings plans may now be used to repay up to $10,000 in student loans.


For more information: Significant Retirement Savings Law Changes Are Coming in 2020 By Michael T Townsend, Charles Schwab



One Day In July LLC
77 College St. #3A
Burlington, VT 05401

How We Are Different
Low-fee index funds. Transparent & fiduciary financial advisors.
Local Financial Advisor
We are in your community We are local.
Investment Management
We tailor to each client. Index funds at the core.
Our Growth
Founded on a simple idea, growing fast.
Dan's Corner
Meaningful musings from our founder.
Fiduciary
Your best interests are our priority.
Low Fees
Our fees are among the lowest in the nation.
Financial Planner
Financial advisor optimizes your financial picture.
U.S. Treasury Bonds
Use Treasury Bonds to reduce risk.
Book Recommendations
Here are some of our favorites
Who We Serve
We work with clients nationwide from all financial backgrounds.
When Should I Invest?
Life transistions = important financial decisions.
Retirement: 401k and More
Retiring? Plan the future you want.
IRA Rollovers
401k Rollovers. IRA Rollovers
Active vs. Passive Investing
We believe there is a winner in this debate.
The Investment Process
How we work: low-cost index funds, personalized attention.
Simplicity
Simplicity is the ultimate sophistication.
Investing: What to Focus On
Low-fee index funds. fee-only advisor.
Switching Financial Advisors
Can be uncomfortable, but an important step.
Advisor Recruiting
We attract top-tier talent. Not your usual firm.
Basic Investing
Let's start with Investing 101.
Understanding Your Financial Statement
Let's break it down to basics.
Index Funds
Broad market exposure, low expense.
Behavioral Finance
Nudge vs. Sludge.
Advanced Investing
Let's geek out on stats and figures.
How Financial Firms Bill
Fee-based vs. fee-only, and lots more.
Who Supports Indexing?
Bogle, Swensen, Buffett, and others.
Transparency
One click to see our fees.
Mutual Funds vs ETFs
Clarifying the difference.
Does Stock Picking Work?
The resaerch says no.
Countering Arguments Against Index Funds
What happens in a down market?
Annuities
Lots of fees, little clarity.
How Do Mutual Funds Work?
Invest in the basket.
How to Relieve Financial Stress
New client? anxiety is normal.
Financial Terms Glossary
Common investment terms you should know.
Firm Comparison
One Day In July vs the competition.
Retired Investing
Retiring? Let us help.
Young Investors
Plant a seed, watch it grow.
High Net Worth Investors
Preserve and grow your wealth.
Investing an Inheritance
Prioritizing and planning for the future.
Widowed Investors
Managing money after a loss.
Female Investors
Your voice needs to be heard. We are listening.
For the Business Owner
Choosing what's best for your business.
Environmental Investing
Carbon intensity, fossil fuels.

Locations

Vermont

New Hampshire

Maryland

United States

Services

Individuals

401k Plans

Institutions

Environmental

Differentiators

Cash Flows

Low Fees

Fiduciary

Dedicated Advisor

Materials

Advisors: Join Us

Careers

Articles on Investing

About the Secure Act

Quarterly Booklets

Resources

Vermont Investment Management

Vermont Retirement Planning

Vermont Wealth Management

Vermont Financial Advisors

Investment Tools

Shelburne, VT Financial Advisor

Frank Koster | Josh Kruk

5247 Shelburne Rd, Suite #101

Shelburne, VT 05482

(802) 777-9768

Stowe, VT Finanical Advisor

Available for meetings in Stowe.

Steve Schleupner

(301) 514-4499

Burlington, VT Financial Advisor

Hans Smith | Katie Muttitt | Nancy Westbrook

77 College Street #3A

Burlington, VT 05401

(802) 503-8280

Portsmouth, NH Financial Advisor

Paul Barry

4 Market Street, 2nd Floor

Portsmouth, NH 03801

(603) 531-3773

Frederick, MD Financial Advisor

Available for meetings in Frederick.

Steve Schleupner

(301) 514-4499


Disclosures | © One Day In July LLC. All Rights Reserved.