Many rules for retirement accounts like 401(k) plans, IRAs and Roth IRAs will soon be changing, after the Senate and House last week both approved a $1.7 trillion federal spending bill that includes new regulations that are collectively called the SECURE 2.0 Act of 2022.
These new laws for retirement follow in the path of the original SECURE (Setting Every Community Up for Retirement Enhancement) Act of 2019, which incentivized retirement plans for employers and gave investors more options for saving for retirement.
The spending bill now heads to President Joe Biden for signing into law. It previously needed to be signed by midnight Friday, Dec. 23 in order to prevent a partial shutdown of the federal government, but the House and Senate both passed resolutions extending the deadline to Friday, Dec. 30.
The biggest changes for most Americans with retirement accounts would be the extension of the age for required minimum distributions and increased “catch-up” limits for people over 60, but there are more than 90 different retirement changes included in the bipartisan spending bill.
Some retirement account changes would take effect immediately after the passage of the bill, while others would start in 2024 or beyond. Read on to learn everything you need to know about the new rules for retirement accounts.
New retirement rule would help Americans with student loan debt
One of the more revolutionary changes included in the SECURE 2.0 Act of 2022 would be the option for employer plans to credit student loan payments with matching donations to 401(k) plans, 403(b) plans or SIMPLE IRAs. Government employers would also be able to contribute matching amounts to 457(b) plans.
This proposed new rule would mean that people with significant student loan debt could still save for retirement just by making their student loan payments and without making any direct contributions to a retirement account. The rule would take effect for retirement plans starting in 2025.
What are the new retirement rules for required minimum distributions (RMDs)?
Currently, Americans must start receiving required minimum distributions (RMDs) from their 401(k) and IRA accounts starting at age 72 (or 70 and a half if you turned that age before Jan. 1, 2020). If approved, the SECURE 2.0 Act of…
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