Our friends at *Copper Leaf Financial have posted some important information about the implications of the SECURE 2.0 Act which substantially changed retirement account rules.
One major concern involved upcoming changes to rules governing catch-up contributions for 401(k) plans. These changes will require catch-up contributions for higher-income earners to be made on a Roth basis.
Making catch-up contributions on an after-tax Roth basis means paying taxes on your retirement savings during the years when you usually earn more. On the other hand, traditional 401(k) accounts allow you to defer taxes until retirement, which can be advantageous if you anticipate being in a lower tax bracket by then.
To read the full post including information about the two-year reprieve for contribution requirements of high-income earners please click here.
*Copper Leaf Financial is an affiliated and separately registered entity.
Recipients should not act on the information presented without seeking prior professional advice. Check with your advisor about your specific situation.
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