A few days into the year of perfect vision (something I never was blessed with) and I’m already wondering what has happened that is important.
Well, it’s an election year. That’s probably important.
And, at the end of 2019, they signed the SECURE Act into law. That means that IRA planning has just become a focal point for more advisors and families. The new rules change a few things favorably and a few more unfavorably. IRA owners can now take their first required minimum distribution at age 72 instead of 70 ½. I guess that’s a plus. But, on the other side of that, the stretch IRA for anyone other than a spouse, is gone. Replacing the ability for children to take inherited IRA money out over their life expectancies, they now must take it out evenly over ten years.
What’s this mean? Higher taxes, of course. And, a lot of money in surviving generation’s hands sooner. What seems somewhat innocuous to most taxpayers is causing quite a stir in the planning community. Already, the major experts in retirement planning have spawned webinars, newsletters and marketing campaigns to address the ramifications of the changes. And, that’s a good thing. Understanding the implications and articulating viable solutions and work arounds is important for every professional advisor.
I’ve already participated in one event and will tune in to another this week. Professional responsibility dictates that I pay attention. It’s complicated and confusing and, as I think about the clients out there, they’re more confused or, worse, unaware. It is the perfect time to take leadership and help people. What’s best for them? Time to figure it out.