How SECURE 2.0 Might Change Retirement

August 02, 2022

The SECURE Act of 2019 represented the biggest update to retirement law in over a decade. Now, Congress is deliberating on what “SECURE 2.0” legislation might entail.

One reason the subject receives so much attention from policymakers in Washington is the lack of preparedness for retirement. According to one study, by 2050, the retirement income gap in the U.S. (the difference between what savers should have in place and what they’ll actually have saved) is projected to be $137 trillion.

In March, the House passed the Securing a Strong Retirement Act with a bipartisan 414-5 vote. The Senate is still weighing numerous proposals for their version, the Rise & Shine Act.

Proposals under consideration include:

  • Raising the Required Minimum Distribution (RMD) age to 73 (eventually 75)

  • Increasing catch-up contributions to $10,000

  • Creating Roth versions of SIMPLE and SEP IRAs

Reconciling these bills will take time, but it’s clear that SECURE 2.0 could bring about another raft of significant changes for business owners and employees. As always, I’m keeping an eye out for what you need to know and will be in touch as events develop.

Note: Passing of the SECURE Act 2.0 will not change anything for retirees currently facing a requirement to take their existing or initial RMD payments this year.