Could a Second SECURE Act Tweak Retirement Rules?
When the Setting Every Community Up for Retirement Enhancement (SECURE) Act became law in 2019, it altered retirement plan contribution and distribution rules. There may be an encore. The Securing a Strong Retirement Act of 2021, nicknamed SECURE Act 2.0, has bipartisan support on Capitol Hill, and public policy analysts widely believe it will become law either this year or next.
This new bill proposes to raise the starting age for required minimum distributions from retirement plans from 72 to 75. (The age threshold would rise gradually over a 10-year period.) The penalty for a missed RMD would be halved, from 50% to 25%.
The new law would allow employers to auto-enroll workers in retirement savings plans, and let them offer small financial perks to employees to stimulate plan contributions. Employers could even adjust matching contributions in view of a plan participant’s student loan burdens; if student loan payments stop a worker from fully funding their retirement account, the company match would be permitted to increase in response.
Retirement savers age 62 and older would have a chance to make larger catch-up contributions to retirement plans. Investment choices would broaden for certain types of retirement savings accounts. Companies with 50 or fewer workers could offset more of the startup expenses for retirement credits using new tax credits.
The bill would also authorize a nationwide lost-and-found website for old retirement plans, making it easier for people to find and make decisions with past retirement balances.[1]
Have Digital Health Certificate, Will Travel?
Digital health certificates—also called COVID vaccine passports—might be available for travelers this year, especially those travelers leaving the country. While U.S. retailers and resorts have been resistant to them, the situation may change this summer as Americans travel internationally and head to foreign airports to come home.
Currently, before you fly into the U.S. from another country, you have to show proof of a negative COVID-19 test result. That applies even if you are a U.S. citizen. So far, the responsibility for checking the test results has fallen to the air carriers.
With air travel increasing, some air carriers are calling for a quicker, digital way to transmit test results and vaccination proof. Major U.S. airlines are encouraging travelers to store scans of vaccination documents on smartphones or upload them as they buy tickets.
At present, it appears digital health credentials are more likely to emerge from the private sector or from state governments rather than from the federal government. Privately developed digital health apps for smartphones may become an innovation in the American travel industry within the next year.[2]
On the Bright Side
In a new GoBankingRates/Upwave poll, 29.2% of baby boomers and 13.9% of Gen Xers report that they are living debt-free or with only insignificant monthly debt.[3]
Securities offered through Cambridge Investment Research, Inc. a Broker/Dealer, member FINRA/SIPC. Cambridge Investment Research Advisors, Inc., a Registered Investment Adviser. Lighthouse Financial, LLC and Cambridge are not affiliated.
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Citations
1. Kiplinger.com, May 19, 2021
2. CNBC, May 22, 2021
3. GoBankingRates, May 19, 2021