Posted by (American Life Insurance Guide Network News) On May 2019, 5, the two parties in the House of Representatives passed the "Secure Act" with 23 votes: 417 votes. The first major reform of the people’s retirement plan system.
The focus of this reform is to encourage Americans to save for retirement and help build a healthy and lasting financial situation.
According to the legislative process, the bill will enter the Senate for voting. After it is passed, it will be placed on President Trump's desk and wait for the signature to take effect.
Core provisions of the retirement bill reform
- The maximum deposit age limit for traditional IRA accounts is abolished and no longer restricted.The current rule is that the upper limit of deposit age is 70.5 years old. After 70.5 years old, you can only withdraw money, not deposit money.
- The mandatory withdrawal age for retirement accounts has been raised to 72.The existing regulations are that IRA and 401K accounts must be forced to withdraw money in accordance with RMD every year after the age of 70.5, and there is a fine for not withdrawing money.
- Allow long-term part-time employees to participate in the 401K retirement plan.
- Allow more annuity options in the 401K plan.
- Within one year of the child’s birth or adoption, parents can withdraw US$5,000 from their retirement account, waived of any fines, to cover related expenses.
- Parents can get from529 Education Savings PlanWithdraw $10,000 from it to repay the student loan.
- Allow qualified retirement accounts to make direct trustee-to-trustee transfers to retirement plans that can provide lifetime income, helping to reduce costs and avoid withdrawal penalties.
What does the bill mean to us?
- Lifetime income annuity:By purchasing an annuity directly in a 401K account, the bill makes it easier to turn retirement savings into lifetime income.
- Regular information disclosure:The bill requires employers to disclose the operation of 401K accounts, and employees will more easily understand how many months their 401K balance will support their retirement income.
- If the bill becomes law, it will be more convenient and cheaper for small and medium-sized enterprises, entrepreneurs, and self-employers to provide 401K, and enjoy tax relief.
- For those who inherit an IRA account, they can no longer rely onThis account provides lifetime income, And rely onStretch methodDeal with tax issues.Instead, you must withdraw all the money and pay the taxes due within 10 years.
American Life Insurance GuideVery supportive"Retirement account information disclosure on a regular basis"This is because in some of the customers we are currently contacting with retirement accounts (such as 401K), many people do not know how 401K accounts operate, nor do they need to participate in financial markets and systems to manage them. Regular information The disclosure will effectively remind participants of the importance and necessity of understanding the American social system and mastering certain financial management skills.
In the appendix, we provide the full text of the proposal for reading and downloading.At the same time, if you want to participate in different types of retirement plans, please contact to make an appointmentAmerican Life Insurance GuideCommunity retirement planning commissioner to understand.
appendix
01. The Secure Act, https://waysandmeans.house.gov/sites/democrats.waysandmeans.house.gov/files/documents/SECURE%20Act%20section%20by%20section.pdf
