What The 2019 SECURE Act Means For You

What The 2019 SECURE Act Means For You

At the end of December, Congress approved and President Trump signed the SECURE legislation, which stands for “Setting Every Community Up for Retirement Enhancement” and it puts into place numerous provisions intended to strengthen retirement savings across the country. There were both good and bad changes! 

Good Changes

The 70.5 age limit for contributing to Individual Retirement Accounts has been removed, which means you now can keep contributing to your 401(k)/IRA accounts for as long as you’d like. 


The age requirement for taking Required Minimum Distributions (RMD) was also increased to 72 from 70.5, which means now you have an additional 18 months before you’ll be required to start taking distributions from your IRA accounts. 

Bad Change 

Heirs of Inherited IRAs no longer have the option to take distributions over the course of their remaining lifetimes. They now must completely withdraw their Inherited IRAs within 10 years, whether they need the money or not. This may trigger significant tax consequences for the heirs. 

What You Can Do

This new law went into effect on January 1st, 2020 and didn’t give people any time to plan or react at year-end. Don’t worry, as we’ve helped you plan before, we’ll help you plan again to enact any necessary changes to your Life Plans. 

Key items To Confirm As Part Of This New Law

Make your spouse the heir to the IRA

Surviving spouses still have favorable rules – taking the funds over their lifetime. 

Review IRA trusts

Some IRA owners have arranged to leave accounts to a trust at their death in order to preserve assets from spendthrift or ne’er-do-well heirs. IRA owners who have set up trusts need to revisit this beneficiary designation as some types of trusts may trigger an immediate payout of the IRA proceeds, thus creating a tax nightmare for beneficiaries. 

Look into life insurance

Life insurance payouts can be free of both income and estate taxes as well. Having life insurance in conjunction with a large IRA balance can be a tax- efficient way to pass money to heirs. 


There are ways to dull the negative consequences of this new law, like transferring your IRA to a special type of trust called a charitable remainder unitrust (CRUT) which could still ensure that your heirs receive lifelong favorable tax treatment on an inherited IRA. We’ll discuss this with you in more detail during your next investment review if applicable. 

About Mason & Associates, Inc.

Mason & Associates, Inc., was founded in 1989, specializing in Life Planning for individuals, families, and small businesses. Life Planning places a person’s core life values at the heart of the advice process and focuses on the human aspects of financial planning.

As a client, your personal story is key to our planning process. That is why we strive to build a close relationship that will encompass every aspect of your life. Together with our team of professionals, we guide you through the process of identifying what is important to you, your goals, your dreams. We then put into place a financial road map to set you on your way toward achieving your objectives.

Our responsibility does not end there. As you encounter bumps in the road, changes in goals, or any other roadblocks, we are there to offer advice and guidance. We are there to celebrate your successes and cope with your challenges. We work alongside your other professionals, such as your attorney and your CPA, to be sure all of your legal and financial needs are aligned.

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