New House bill may change how you plan for retirement

MSN 'News' ^ | June 14, 2019 | ABC 'News' Staff

[Diana in Wisconsin]

The House of Representatives recently passed a bill that may complicate retirement planning options for Americans.

The House passed the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019 on May 23. If enacted into law, it could be tricky for Americans who are not financially savvy investors.

Some of the changes could benefit consumers: The law encourages more small employers to offer 401(k) plans and raises the age for required minimum distributions (RMDs) from retirement accounts to 72 from 70.5, a nod to longer life expectancies and later retirements.

However, there are some changes that consumers should be wary of, experts say.

For example, one change in the law would shorten the amount of time that someone who inherits an Individual Retirement Account (IRA) can hold onto the funds, potentially causing them to lose money.

"If you inherited my IRA — before I'd be able to stretch the distribution over your lifetime, which is more time for dollars to grow tax deferred. Now you have to drain that inherited IRA over 10 years, which gives you less time to grow the money on a tax-deferred basis," Dave O’Brien, chair elect of the National Association of Personal Financial Advisors (NAPFA), told ABC News.

Another change that American workers should be wary of, according to consumer advocates, is adding annuities — complex financial tools offered by insurance companies — to 401(k) plans.

*SNIP*

[Red Badger]

2 out of 3 ain’t bad..................

[Big Red Badger]

Annuities,,
No way!
Thanks.

[Diana in Wisconsin]

Someone was trying to talk me into buying one. So glad I didn’t. Just did NOT have a good feeling about it from the git-go. :)

[dfwgator]

I “learned to code” a long time ago, I can’t imagine not coding, even if I don’t get paid for it. It’s just something I enjoy doing, so I will probably keel over on my keyboard just when I’m about to deploy my app. ;)

[bert]

House bill......

The House is powerless to do any thing but screw around trying to be relevant. No discussion is necessary of the House balderdash

[Big Red Badger]

Social security,,,
Draw early to
Get Some,
Yup.

[CurlyDave]

...My experience as a forty plus yr investor is I have never seen an annuity plan I could not beat by a simple investment plan....

+1

I have over 60 years investing experience, and am in complete agreement on annuities. A great way to enrich an insurance company at your expense.

Learn to manage your own money.

[Big Red Badger]

You don’t like Dogs?

[Red Badger]

I just read an article that Google, FB and others will still track you for years, even if you close your accounts with them. So even if you write a killer app they will not allow you to put it on their market places..............

[Red Badger]

Don’t smoke..................

[Diana in Wisconsin]

“My experience as a forty plus yr investor is I have never seen an annuity plan I could not beat by a simple investment plan.”

I didn’t buy one. Really wasn’t even tempted. I felt they were a bad deal from the start.

I retired three years ago at 56. What allowed me to do that were a few things:

1. Not being a SUCKER for ‘get rich quick’ schemes (LOL!)
2. Little or no debt, other than a mortgage - ever
3. 17 years in the Army, so I had a lot of pay with low expenses and now have medical care thru the VA (had to leave early; had a kid with special needs)
4. Always lived below my means and drove used cars
5. Invested in (physical, NOT paper!) PMs 15 years ago; smartest thing I ever did
6. Sold my paid-for farm & can easily live on that $ until I get my SS at 62 (or 65...still playing with ALL the numbers)
7. Always took advantage of a 401K via an employer & have had my own IRA for-ever

It CAN be done, but you need to be disciplined and also the example of my Dad & Grandpa retiring in their late 50’s made me want to beat them at their own game. ;)

[semimojo]

These Rats need to leave my retirement funds alone.

It passed the House 472 to 3 and it looks like Grassley's pushing it in the Senate.

[Freedom56v2]

You know one of the things I am wondering about is whether to take SS at age 65 w/reduced benefits or wait until 70....Get more at 70, but I wonder if our elected “representatives” will change it, means test it etc...Seems whenever there is a discussion of the debt/deficit, Social Security is front and center...

Perhaps should take the money at 65 while can...

[Yardstick]

It’s in the Democrats’ DNA to make it harder to pass wealth down to your children.

[COBOL2Java]

It passed the House 472 to 3 and it looks like Grassley's pushing it in the Senate.

Makes sense - no skin off their noses...

[CurlyDave]

...The only rules they can really change that would have much effect on me are SS rules. and those are pretty difficult for them to change...

You need to re-think this a bit.

Every year the SS Trustees issue a report on the SS system. Right now, if nothing changes, the SS Trust Fund will be completely depleted in ~2034, maybe a little sooner. (The exact date varies a little bit from year to year.) At that time they will only be able to pay ~75% of current benefits.

If you have not already retired, this will happen in your lifetime.

There are lots of speculations on what will be changed, and nobody knows for sure, but I am 100% certain that any changes will be negative for those who have prepared on their own for retirement.

[angry elephant]

I will. Don’t have to, but I will. I have retired friends looking for jobs, any jobs. They don’t need the money. They got bored. There’s only so much ‘recreation’ you can do before it gets old. Fishing, golf, travel, hobbies, they all get old after a while. You gotta have a reason to wake up every morning...................... “

I’m like you, work until I die. I have always been self employed and work a little less now than I did when younger. It seems to me that it is better to stick with whatever your craft is than to retire, get bored, and then scramble for some lesser job that is not really in your skillset.

As several of my retired friends have said, “Retirement isn’t really that great.”

[billyboy15]

You had a plan and stuck with it and that is great!!

My feelings on SS is take it as soon as you can unless you some really sound proof as to your lifespan. Even if you don’t need it you can take it an invest it for your heirs.

And remember, if you get a part time job you can still text a retirement plan to the max while paying zero taxes on not your salary, at least up to the max allowed amount deposited in your 401 or IRA.

[DoughtyOne]

Thanks so much for your support to this point... I personally apprecaite it...
FReepers, it's far beyond time to wrap up this FReep-a-thon.  Lets do it today.  Please chip in.

President Donald J. Trump and the Free Republic of the United States of America
President Donald J. Trump's address to the United Nations on 09/19/2017.

Ramirez political cartoon:  Google LARGE VERSION 06/12/2019: LINK  LINK to regular sized versions of his political cartoons (archive).
Garrison political cartoon:  Socialism the Millennial Flytrap LARGE VERSION 06/2019: LINK  LINK (scroll down) to regular sized versions of his political cartoons (archive).

FReepers, 98.763% of the Second Quarter FReep-a-thon goal has been met.  Click above and pencil in your donation now.  Please folks, lets end this FReepathon.  Thank you!
...this is a general all-purpose message, and should not be seen as targeting any individual I am responding to...

Just $209.00 dollars to 99.00%

[Red Badger]

Exactly what mine said!

I have a friend, retired from the gas company, good pension, asks me every time we meet if there are any ‘openings’ at my work. He’s done the RV travel trailer thing, fished, and all the regular stuff. We ride motorcycles together with our wives about once a month. It only took him two years to get bored ............