TEN THINGS
YOU SHOULD KNOW ABOUT
“The SECURE Act”
Setting Every Community Up for Retirement Enhancement The SECURE Act
  1. Change age of RMD to 72.
  2. No Age Restrictions on IRA Contributions. You used to have to stop at age 70.5 but not anymore!
  3. 401(k) for Part-Time Employees – Starting in 2021 if you work at least
    500 hours for at least three consecutive years you can now contribute. Must be 21 by the end of the three years.
  4. Penalty-Free Withdrawals for Birth or Adoption of Child. You can take out up to $5,000 after the birth or adoption of a child without incurring the 10% penalty. You do still have to show the $5k as
    income on your tax return.
  5. Annuity Information and Options Expanded. This one does not start on 1/1/20. In 401(k) account, it will not only show you your balance but also lifetime payout option. The only way to do that is with an annuity. You will also be able to purchase an annuity in a 401(k).
  6. Auto-Enrollment 401(k) Plans Enhanced. Automatically signs up them up at 3% but they can cancel it or change the amount. The gradually increase the amount each year and stops at 6%.
  7. Help for Small Businesses Offering Retirement Plans. 3 Provisions. Increases tax credit available from $500 to $5,000. $500 credit for auto enrollment. Third, completely unrelated employers to participate in a multiple employer plan and have a pooled plan provider administer it. Allows small businesses Economies of
    Scale.
  8. Grad Students and Care Providers Can Save More. This allows students to show money they receive as income so they
    can make contributions to an IRA and start investing earlier. Similarly, difficulty of care payments to foster-care providers
    can now be used for IRA contributions.
  9. Stretch IRAs Eliminated. Now the funds must be distributed over 10 years.
  10. Credit Card Access to 401(k) Loans Prohibited. You cannot get issued a credit or debit card that gives you access to your 401(k). YOU can take a loan of up to 50% of your value but it has to be paid
    back in 5 years or longer if it was a for a first time home purchase.