How Does the Secure Act Affect My Estate Plan?
Part of becoming an adult is preparing for your future. Unfortunately, this means you need to worry about what happens to your belongings when you die. This is even more important if you have a family because you need to create an estate plan that keeps their best interest in mind.
Creating an estate plan is vital, but you need to make sure you do it right. Most states have laws and legal regulations that influence your estate plan now and in the future. The Secure Act is one of those regulations. If you’re wondering how this will affect your estate plan, let’s discuss.
Understanding the SECURE Act
To know how the SECURE Act can affect your estate, it is essential to understand what it does. The underlying purpose behind the Act is to alleviate the expected retirement crisis. The Act considers both the employee and employers. The act has a total of 29 provisions. It encourages retirement and offers other plans and benefits like 401(k) for employees of small businesses.
Your estate plan could be affected in various ways by the SECURE Act. If you fall under any of the following conditions, you can benefit from this act:
Unfortunately, today, there are many reasons individuals can only take on part-time work. Anyone who is struggling to secure their financials will need a retirement plan for the future. But, unfortunately, many companies and businesses do not offer retirement benefits to part-time workers. With the SECURE Act movement, part-time workers can claim their right to retirement and secure their future.
Small Business Owners
The Act makes it easier for small businesses to offer retirement plans and benefits to their employees by increasing tax credits. When following the Act, the business is also listed among higher ranks making it more competitive. This benefits the business as more talent will be attracted to it. This plan rules out the trouble for small businesses that can’t afford to give their employees good retirement packages, making it a more affordable option for them now.
The SECURE Act allows retirees to save more by excluding the retirement age limit that many other plans have at seventy and a half. It also extends the age of retirement by one and a half years so that you can save longer. This will give you more time until you are eligible to take money from the annual RMDs.
The SECURE Act can benefit those ineligible from traditional retirement savings options, as it significantly contributes to building up your savings. Still, as with everything, there are also disadvantages to the law. Those opposing the SECURE Act primarily perceive it as negatively affecting future generations of inheritors. The Act does not support a “stretch” option where inheritors could withdraw the distributions for a more extended period. While following the SECURE Act, the beneficiaries must now remove all assets from an IRA within ten years following the owner’s death. Still, most say its benefits outweigh the disadvantages.
Contact a Reliable Probate Attorney for All Your Needs
If you have questions about your probate situation, contact a trusted Diamond Bar estate planning attorney to schedule a consultation.