SECURE stands for Setting Every Community Up for Retirement Enhancement. Consider what the SECURE Act does for: • Retirement accounts — it pushes the age back from 70 1/2 to 72 for the required minimum distributions, and it allows traditional IRA owners to keep making contributions indefinitely. • Nonspouses inheriting IRAs — it mandates that most nonspouses inheriting IRAs take distributions that end up emptying the account in 10 years. • Students — it allows the use of the tax-advantaged 529 accounts for qualified student loan repayments up to $10,000 annually. • New parents — it lets them take penalty-free withdrawals up to $5,000 after the birth or adoption of a child. • Small business owners — it will make it easier for them to set up “safe harbor” retirement plans that are less expensive and easier to administer. A big change to IRAs based on the SECURE Act is the removal of the “stretch IRA.” The stretch IRA has allowed nonspouses inheriting retirement accounts to stretch out disbursements over their lifetimes. In other words, some clients have passed down their IRA from generation to generation without taking a distribution. So, in essence, it’s like the IRA account from a great-great-grandfather passed down to his children and their children while they continued to watch it grow. This is no longer possible. THE FACTS YOU NEED TO KNOW SECURE ACT OF 2019
READY TO TAKE UP THE NOMADIC LIFESTYLE AFTER RETIREMENT?
You’ve worked hard for years to arrive at this moment: retirement. Now that you’re free of your 9-to-5 job, you have a lot more time for activities you enjoy. That extra time is what leads many people to turn to a nomadic lifestyle after retirement. Touring in an RV, sailing around the world, or even just retiring to a cabin in a remote locale are all popular options for new retirees. If the spirit of adventure is calling you, here are some financial tips to set you on the right path. DOWNSIZE BEFORE YOU GO Some folks choose to sell their home and use the income to fund their travels, staying in apartments and rentals as they go. If that seems too drastic, downsizing to a smaller home is also a good option, especially if you plan to travel in intervals but want a home base to return to. This also gives you the option of renting your home while you’re away and using the money to continue traveling. ASK OTHER NOMADS Crowdsource advice from friends and family members who’ve taken the leap. Lots of other people have shared your dream and made it a reality. Many have turned their experience into books or blogs, like Lynne Martin, who’s been traveling around the world with her husband, Tim, for the last three years. The Martins used the sale of their home to finance their travels. They also take cruises to cut down on travel costs and often dine in to save money. DO YOUR RESEARCH If you have a specific place in mind for your retirement, like Hawaii or Texas, look at rental costs and other lifestyle changes that can affect your budget. For example, Hawaii’s cost of living is cheaper than other popular retirement states, like Florida, but basic commodities may be more expensive. If a boat or RV is more your style, be sure to add repair and fuel costs into your budget. As you go about researching and planning, be sure to consult with your financial advisor so they can help you look at your current situation and make adjustments. With the proper planning, you’ll be living your nomadic dream in no time.
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2 | 740-314-4829 This newsletter is for informational purposes only and no legal advice is intended. Be sure to consult with this law firm if you have a specific question about your situation. And, remember Edward and Jeff don’t take any unplanned inbound telephone or in-person meetings. We believe each case deserves our undivided attention.
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