Senior market analyst
FSG Advisors at the 2020 IFG Retreat
What does the SECURE ACT mean for you? FSG Adventures Upcoming Firm Events Recipe of the Month Monthly Read
This Month
January Newsletter
What does the SECURE Act mean for you?
You might have heard that this past May the House of Representatives voted to pass the “Setting Every Community Up for Retirement Enhancement” Act. What you’re probably wondering now is if, how and when this will affect the retirement plans you’ve been working towards. As your advisors, we thought it was important to break down the most relevant aspects of this new law, as it might relate to your specific situation. The most notable aspects of the SECURE ACT, which we’re sure you’ve been hearing a lot about are; the age increase we will see in the required minimum distribution age by 18 months, from 70½ to 72, and the changes we’ll see in 401k accounts moving forward. But there’s a lot more to know about the changes that this Act will bring forward, so stay with us as we go over the SECURE ACT facts, some of which may pertain to you, and some that will not. The Big Facts: 1. The required minimum distribution age is being increased from 70½ to 72. This means that you now have an extra 18 months
to allow your retirement funds the opportunity to grow and increase in value before being forced to withdraw from them. For our clients that have already turned 70 ½, previous regulations still apply to you. 2. Investors are no longer prohibited from contributing to a traditional IRA if they are 70½ and older, as long as they are continuing to earn income. This means that if you aren’t ready to retire, you can continue to put money into a traditional IRA well into your 70’s. 3. Part-time employees will now have access to 401k’s.This guarantees that even part time employees, who have worked at least 500 hours per year, for at least 3 consecutive years (and are 21 years old by the end of that 3-year period) are now eligible for a 401k account. 4. There will now be penalty-free withdrawals for the birth or adoption of a child. If parents have a retirement account, and they’re in need of some extra cash flow during this time, the Act allows each parent to withdraw up to $5,000 out of their retirement account. Prior to this, there would have been a 10% early- withdrawal penalty. Federal income tax is still applicable.
Facts that might pertain to plan administrators, or those of you looking to offer a 401k retirement plan to your employees: 1. Annuity information and options will be expanded. The Act requires 401k plan administrators to provide an annual “lifetime income disclosure statement” to your employees that are contributing to your business’s 401k plan. This means that your employees would be able to see how much money they could get each month, if their 401k-account balance was used to purchase an annuity. *An annuity is a series of payments made at equal intervals or frequency. Examples of annuities are regular deposits to a savings account, monthly home mortgage payments, monthly insurance payments and pension payments*. The SECURE Act will also make it easier for 401k business owners, i.e., plan sponsors to offer annuities and other options to plan participants. 2. Small businesses offering retirement plans will be given help.The Act will increase the tax credit available for 50% of a small
5. Money paid for the purpose of extended study (such as graduate or post-doctoral study) are now treated as compensation when making IRA contributions.This part was put into effect to allow students to begin saving for retirement sooner. 6. The Act is essentially doing away with the “stretch IRA” for non-spouse beneficiaries. Distributions over the life expectancy of a non-spouse beneficiary would be allowed if the beneficiary is a minor, disabled, chronically ill, or not more than 10 years younger than the deceased IRA owner. For minors, the exception would only apply until the child reaches the age of majority, which in most states is 18.At that point, the 10-year rule would kick in. For example, under current law, a one-year-old who inherits an IRA is considered to have an 81.6-year life expectancy. Under the SECURE Act, that child would have until age 21 + 10 years to withdraw from the IRA, so at 31 years old. Facts that might pertain to plan administrators, or those of you looking to offer a 401k retirement plan to your employees:
business’ retirement plan startup costs. Also, instead of the $500 per year credit limit, the Act will increase the maximum credit amount to $5,000. 3. Credit card access to 401k loans will be prohibited.This Act would put a stop to 401k plan administrators allowing employees to access plan loans by using credit or debit cards. We recognize that these new regulations will impact our clients in completely different ways, some more so than others. Every individual’s retirement savings plan is unique and should be addressed as so. As always, we are here to talk through any concerns or questions you might have as we see these changes start to take place, please do not hesitate to give us a call. As your financial planners, our sole priority is you and your family’s financial plan, and you can trust that we will be working alongside you to make sure your future is taken care of. *Sourced from HorsesMouth
Chris and Nick in Bryant Park during the Holidays!
FSG Adventures
The FSG team during our Secret Santa Swap!
Aimee and her husband on their trip to to Meigs Falls, Teneesee.
Upcoming Events
To RSVP, you can use the link below or email AImee@fsgplanners.com https://fsgplanners.com/events/meet-the-professionals-2/
Recipe of the Month
Half Baked Harvest: Sweet and Spicy Tomato Basil Pepperoni Pizza
Instructions: Preheat the oven to 450°F. Grease a large baking sheet with olive oil For pizza dough, on a lighlty floured surface, push/roll the pizza dough untul it is pretty pin. Transfer the dough to the prepared baking sheet. For the naan bread, simple remove from the packing and place on the baking sheet. Spread the dough with tomatoes and pesto. Sprinkle with red pepper flakes. Add the cheses, jalapeno slices and your choice of soppressata or spicy pepperoni.
Ingredients: 1/2 pound pizza dough, homemade or store bought (we used store bought naan bread and it was amazing!) 1 cup San Marzano crushed tomatoes 1/4 cup basil pesto, homemade or store bought 1 pinch of crushed red pepper 1 cup shredded or torn mozarella cheese 1 cup shredded fontina cheese 1 jalapeno or serrano pepper, sliced 2 ounces thinly sliced spicy pepperoni or hot soppresatta 1 cup fresh basil leaves honey, for drizzling
FSG's January Read
Half Baked Harvest Cookbook: Super Simple Our team has been having so much fun testing out the simple, and insanely delicious recipes in our new favorite cookbook that we thought we'd share! We've tried everything from Half Baked Harvest's pizza and noodle recipes to the everything bagel salad, and chicken tortilla soup. There is pretty much something in here for everyone and they really are that easy! "We all want to make and serve our loved ones beautiful food--but we shouldn't have to work so hard to do it. With Half Baked Harvest Super Simple,Tieghan Gerard has solved that problem."