Posted on 06/14/2019 6:28:50 AM PDT by 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*
(Excerpt) Read more at msn.com ...
Who is a good person to talk to regarding SS rules and advice?
I’m with you- I am 62 this year and I am taking it as soon as I can get it- but I can work part time doing contract work.
I dont want to take SS but end up getting $0 because of the income I make from my contracting work.
While the Rats claim they are for the little people and working stiffs, this provision pumps billions of dollars into the hands of the greedy insurance companies and so-called financial planners. Annuities are inappropriate for 99% of investors because of their high costs, expenses, fees, commissions, lack of liquidity, and surrender charges. And in my opinion any insurance agent, financial adviser, or employer who peddles tax deferred annuities for use in a tax deferred retirement account, ought to go to prison for fraud.
Don’t buy annuities or time shares, the contract language always favors the sellers and screws you.
You can earn up to $17,040 per year without any reduction in Social Security income. However, once your income exceeds that amount, Social Security will hold back $1 for every $2 earned.
+1...also geared toward hourly (blue collar) workers; would need to tweak for attorneys & consultants.
We absolutely need to get 2020 locked down which includes Senate and regain the House but just as importantly,we need to prepare for 2024. What the leftists have in store for America is no different than what the Nazi Party ramped up in the 30’s.
The person to speak with is a tax accountant, preferably one who specializes in retirement.
Whatever you do steer well clear of investment advisers who will try to sell you something.
We tied everything up in Marital Trusts, and survivor Trust funds. Not that we have a fortune, but want to keep and grow what is ours. Hubby is already drawing out of his IRA, I’ve got 2 more years before I do. Neither are big. My Annuities are decent to leave a small nest egg for the one who survives, and pass on to the kids, those are specific marked.
House and Cars + household goods are up to the kids to divvy up.
I get all that. It’s one reason a main focus is getting my expenses as low as possible (and other things).
I don’t think the country as we know it is going to last to 2034, though.
When it comes to all this stuff it reminds me of NYC, back in the very early 1900’s, worrying about how they were going to handle, for the upcoming decades, all the horse poop downtown.
The problem fixed itself.
That’s a very good summary analysis of the Dem motivation. I would only add that they now want to steal the trillions of dollars people have saved through their IRAs to “pay” for votes for them.
And THAT is the key. The insurance industry wanted to get their piece of the 401(k) pie so they sent their army of lobbyists to congress to grease the congressional members palms and behold...a new law proposed to "help the little people." That's how congress works.
You asked “ If one of the original beneficiaries dies, not having taken out his/her share, then what happens?”
It is very clear that 1) the decedent’s will specifies his or her beneficiaries, 2) the decedent’s IRA is a part of his/her estate, and 3) the IRA then flows to the decedent’s beneficiaries. The RMD distribution schedule and amount is specified clearly in the tax law.
I don’t know how the RMD is calculated if the IRA has flowed down three or more generations.
We are doing this for my parent’s IRAs and my BIL’s IRAs.
If you doubled the value over the last 20 years then you annual return was about 3.6%, which is slightly more than half the return of the S & P 500 from May, 1999 to May, 2019.
All insurance policies are a crap-shoot based on actuarial tables. I bought my mother a Long-Term Care policy. She needed care at the end of her life and it more than paid for itself. If she had quietly passed in her sleep one night, we would have thrown that money away.
Of course, we bought that policy over 20 years ago when LTC was a lot more affordable than today.
“no reason why preferential tax treatment should extend beyond the grave”
By that logic, then the inheritance tax should be 100%. I personally like the ability to bequeath assets to our children to give them a better start in life. I especially like being able to do that on a tax-sheltered basis. Why should the government get their grubbing hands on MY saved assets just because I happen to pass away? It is SO much better for society as a whole if we pass that down to our progeny and encourage them to save for THEIR futures.
“You gotta have a reason to wake up every morning”
Isn’t jumping on FR enough reason? Of course, not waking up in the morning is bad news.
“Coat the poison with candy.”
Yeah — as soon as you spot a Silver Lining from the Rats, look for the Dark Cloud. Won’t take you long to find it. And the Dark Clouds completely overwhelm any Silver Lining they toss at you.
That’s how I wanna go!...............slumped over the keyboard with FR on the screen!............
“The House is powerless to do any thing but screw around trying to be relevant.”
That may be true in 2019 and 2020, but they ARE telling us what they will do if (and when) they recapture both chambers and POTUS. And it isn’t a pretty picture, as usual.
“the example of my Dad & Grandpa retiring in their late 50’s made me want to beat them at their own game”
Nice! Nothing like a little healthy inter-generational competition!
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.