Happy New Year! We trust you had a wonderful Christmas and holiday season. One of the final things Congress did last year was pass something called SECURE 2.0 Act, a new law designed to boost participation in workplace retirement plans. What are the main features, and how does it help retirement savers? Here are some of the main features and changes in the new Secure 2.0 Act. • Postpones Required Minimum Distributions. It raises the age for mandatory withdrawals from 401(k) accounts, TSP’s, 403B’s, 457 plans, Traditional IRA’s and SEP IRA’s from the current age of 72 that was put into place by the original SECURE Act. Starting this year in 2023, savers will be required to begin withdrawing funds at age 73, a change that gives them more time to squirrel away cash for retirement. The legislation will eventually raise this age threshold to 75 in year 2033. If you were already taking RMD’s in 2022 and prior, you need to continue. • 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 IRA’s. • Starting in 2024 – RMD’s will no longer be required from Roth accounts in employer retirement plans. • Automatic Enrollment Required. The provision would enroll savers at a rate of 3% to 10% of their annual pay initially and contains exemptions for newly created businesses and companies with 10 or fewer employees. We just recently had a client come in who noticed his employer automatically increased his 401K contributions. If you don’t want this to happen you will need to call your 401K provider to handle. • Extra Catch-Up Contributions. Starting January 1, 2025, SECURE 2.0 also allows workers ages 60 to 63 years old, to be able to make catch-up contributions up to $10,000 annually to a workplace plan and that will be indexed for inflation. • Savings for Emergencies in 401(k)s. These allow employers to offer their workers pension-linked emergency savings accounts, with an employee contribution cap of $2,500 per month. Under the legislation, workers would be able to withdraw up to $1,000 once per year for personal or family emergencies without certain tax concerns. The rules to the game are always changing. As we learn more about the new rules in this law, we will keep you informed. If you are a client and have not had a review in a while, reply to this email or call our office at (571) 577-9968 to schedule a time to speak. If you are not a client and you don’t have a comprehensive Phase 2 retirement plan and roadmap built for you, reply to this email or call us at (571) 577-9968 to schedule your complimentary second opinion and Where Do I Stand Plan.   As always, any and all questions are welcome. We are here for you.

All our best, Abe Abich & the Abich Financial Team