Last week, we spoke about what The SECURE Act is and how it changed Stretch IRA's. In our second post on The SECURE Act, we will be discussing the age restrictions on IRA Contributions and Required Minimum Distributions (RMD's).
Age Restrictions for IRA Contributions
Life expectancy in the United States has increased over the past fifty years. With the average American living longer, this has lead to them working later in life as well.
Prior to January 1st, 2020, individuals were not allowed to make contributions to their Individual Retirement Accounts (IRA) after the age of 70 1/2. Once The SECURE Act was passed, this age restriction was removed. Individuals can now contribute longer into their lives.72 is The New 70 1/2
An early birthday present came this year for everyone who was getting ready to turn 70 1/2. A Required Minimum Distribution was required to be taken by April 1st!
With the new law, a required minimum distribution isn't required to be taken until you turn 72!
If you would like more information, or to look into how this may affect you personally, click on the Get In Touch tab on www.sixpointfp.com !