As a somewhat surprising end-of-year move, the SECURE Act was attached to a government funding bill. Why this is surprising isn’t because the bill was passed, but that it got passed this year after some major backlash.
This past summer, it looked like the SECURE Act’s passage was all but a foregone conclusion after flying through the House with a 417-3 vote. While most of the focus has been on how the SECURE ACT’s annuity provisions and required minimum distribution rules will impact retirees, a lot of features in it will also impact young savers and investors.
Let’s start by looking at the initial backlash and why this will impact younger savers. As Steve Parrish, Co-Director of the Retirement Income Center at The American College of Financial Services put it “if all ships rise with the tide, this new law should help young savers re-think their financial priorities. The SECURE Act is the first major retirement legislation since the 2006 Pension Protection Act. The attention it will provide Americans concerning retirement crises will hopefully spur more young savers to think about their own retirement.”