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Secure Act 2.0 Overview Thumbnail

Secure Act 2.0 Overview

On December 23, 2022, the Secure Act 2.0 was passed by Congress and signed into law on December 29. This legislation provides a slate of changes that could help strengthen the retirement system and builds on earlier legislation passed in 2019 called the Secure Act.

There are literally dozens of provisions in the new legislation, and we will be bringing you details in our next blog post. For now, here are the highlights of what you need to know:

  • The age to start taking RMDs increases to age 73 in 2023 and to 75 in 2033.

RMD secure act 2023

  • The penalty for failing to take an RMD will decrease to 25% of the RMD amount, from 50% currently, and 10% if corrected in a timely manner for IRAs.
  • Catch-up contributions will increase in 2025 for 401(k), 403(b), governmental plans, and IRA account holders.

401k secure act 2023

  • Defined contribution retirement plans will be able to add an emergency savings account associated with a Roth account.
  • 529 Plans. After 15 years, 529 plan assets can be rolled over to a Roth IRA for the beneficiary, subject to annual Roth contribution limits and an aggregate lifetime limit of $35,000. 

529 plans secure act 2023

There are many additional changes that require attention or consideration; the changes have various effective dates in 2023, 2024 and 2025. We will be updating you regarding the impact on your financial planning in our next blog post.

This commentary reflects the personal opinions, viewpoints and analyses of the Seaside Wealth Management, Inc. employees providing such comments, and should not be regarded as a description of advisory services provided by Seaside Wealth Management, Inc. or performance returns of any Seaside Wealth Management, Inc. client. The views reflected in the commentary are subject to change at any time without notice. Nothing in this commentary constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Seaside Wealth Management, Inc. manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.