What do you need to know about the Secure Act that passed in December of 2019? The Secure Act contains many provisions, but we are going to focus on two major points: how the SECURE Act affects Required Minimum Distributions (RMDs) & the elimination of the 10 year Stretch.

The SECURE Act may require you to make some adjustments to your financial plan, especially if your intention is to leave a legacy to future generations. Non-spousal beneficiaries of inherited IRA and other retirement accounts will no longer be able to enjoy the lifetime “stretch” provision, but instead will need to distribute the entire amount of the inherited IRA within 10 years. This can be done over the course of the 10 years, or all at once as long as the entire amount is distributed within the allotted time.

Required Minimum Distributions, which were required to begin at age 70 ½ prior to the CARES Act will now start at age 72. Of course, if you have already begun taking RMD’s when the CARES Act was enacted, you must continue to do so.