Setting Every Community Up for Retirement Enhancement (SECURE) Act

[SLB_SA]

Congress Just Passed the Biggest Retirement Bill in More Than a Decade. Here's What You Need to Know Link1
What the SECURE Act Means for Your Retirement Link2 
The SECURE ACT pdf (Ways and Means committee bill; I am not certain if the provisions of the passed bill are identical.)
Congress passed the SECURE Act — how much will it actually help people save for retirement? Link3
"Enactment of the SECURE Act will serve as the most significant retirement policy legislation since the Pension Protection Act in 2006. It is a top priority of the American Retirement Association."  Link4
"Some of the biggest features of the bill for individual investors include removing the age limit restricting IRA contributions; raising the age at which people need to start taking required minimum withdrawals; provisions that could encourage annuities in work-based retirement plans; and closing a loophole that allowed affluent investors to stretch the tax advantages of IRA across multiple generations. For younger investors: $10,000 of 529 plans can be used to pay off student debt and people can take out $5,000 from 401(k) plans without penalty to help with the costs related to a child’s birth or adoption."  Link5

The SECURE ACT of 2019 passed Congress.  Supposedly Trump will sign it; I have no knowledge of reports that say otherwise.  The changes are listed in the pdf link above.  Some items:
1. RMDs do not start until age 72 (up from 70.5).
2. No age limit to making contributions to traditional IRAs.

 

[WalkaboutTed]

Yeah, its wonderful for the Haves and the Haves Mores...

From Bloomberg:
"The bad news is that almost half of Americans approaching retirement have nothing saved in a 401(k) or other individual account. The good news is that the new estimate, from the U.S. Government Accountability Office, is slightly better than a few years earlier.

Of those 55 and older, 48 percent had nothing put away in a 401(k)-style defined contribution plan or an individual retirement account, according to a GAO estimate for 2016 that was released Tuesday. That’s an improvement from the 52 percent without retirement money in 2013.

Two in five of such households did have access to a traditional pension, also known as a defined benefit plan. However, 29 percent of older Americans had neither a pension nor any assets in a 401(k) or IRA account."

Ted

 

[B and C]

Yep, failure to plan for retirement is a plan to fail in retirement. If it wasn't for SS being a forced retirement plan, those people would have nothing.

 

[bullfrog]

Sure seems like a lot of bills are getting passed and a lot of politicians are retiring or not coming back. Wonder if it is just a coincidence? LOL!!!

 

[Qxxx]

As I recall the guy that pushed through credit card reform 8 or so years ago retired that year and went to work for a big bank. As a result of that "reform",  my cc APRs immediately all shot up by 5% points. And now Wells keeps sending me cc solicitations guaranteeing me an APR between 17.99 and 27.99%. Make my day. The rich really are different.

 

[mpruet]

The key is to pay your CC in full each month.  That way you don’t care about any APR.

 

[mpruet]

... almost half of Americans approaching retirement have nothing saved in a 401(k) or other individual account. The good news is that the new estimate, from the U.S. Government Accountability Office, is slightly better than a few years earlier.

Two in five of such households did have access to a traditional pension, also known as a defined benefit plan. However, 29 percent of older Americans had neither a pension nor any assets in a 401(k) or IRA account."

Whose fault is it that folks don’t have a nest egg for retirement?  

When I was young 50 years ago, all I heard was that SS would be going away and that I would only have myself to blame when I reached retirement and didn’t have any savings.  It’s the old ‘ant and the grasshopper’ fable.  And I decided long ago that defined pensions were dangerous because one of the goals of every business is to cut expenses and a defined pension is an expense.  Look at how many folks have either lost their pension, been forced into a lump sum, or had a drastic cut in their benefits because their company has run into rough times.  Way too risky.  

Not only that, but the size of a nest egg to support a retirement income of $40,000 per year is close to $1,000,000 and very few lump sum payouts approach that level.  So even the lump sum payouts are effectively a reduction in projected benefits.  

No - the only safe way to have a decent and secure retirement is to DIY.

 

[WanderingRose]

Many, many people in this country never get in their entire lives beyond an income level that is basic subsistence, hand to mouth living.

For whatever reason, it then being impossible to build up substantial savings to draw from later in life.

I know people who are technically retired, and drawing their SS, but have to continue working part time in order to meet health insurance and health care costs.

A couple of life crisis drained savings they had built up.

When they are no longer able to work part time, then will come the real crisis.

It’s not as simple as not planning well.

 

[mpruet]

Many, many people in this country never get in their entire lives beyond an income level that is basic subsistence, hand to mouth living.

 Basic Subsistence???  Even the poorest in the USA are far more wealthy than over 90% of the world’s population.  

I spent some time in The Gambia where my son was in the peace corps.  I saw real poverty there, and there was no government aid. Yet the people were content and did just fine as they reached old age.

 

[WalkaboutTed]

It is disingenuous to compare the USA with Gambia. The biggest problem as far as supporting the aged here and elsewhere in the world is the decline of the multigenerational household (think of the Walton's). The nuclear family typically has no room for the grandparents, or if they do, there is noone home to take care of their increased care needs. Heck, there's noone home to take care of the children in many cases.

That is, if the old folks were lucky enough to be able to bear and raise and pay for the education of their own children-and, in the process, decreasing their own retirement nest eggs to take care of said kids.

We like to blame the victim in their bad luck. Why do you have cancer? Oh, you lived with smokers-your fault! Why did you lose your house in a fire? You lived in the wrong neighborhood-your fault! Why did your wife leave you? You have bad judgement-your fault! Why do you have diabetes? You ate the wrong foods-your fault! Why are you fat? You have a character defect-your fault! Why is your kid using drugs? He had bad parents-your fault! Why are you homeless? Because you are a worthless human being, bad judgment, bad luck, bad character, bad financial decisions, bad family-all that is your fault! Why are you broke? Bad choices, blah, blah, blah-your fault! That way we can say "That won't happen to me, I'm better than that."

Working as an RN, counseling patients (mostly older) with catastrophic illnesses or expensive chronic conditions, I don't know how many times I heard "We had good retirement savings, but it's been eaten up with health-related expenses"

It's a sad situation all around and a cruel country. I got mine, screw you!
Ted

 

[mpruet]

No - what is disingenuous is to claim ‘bare subsistence’ when you are living with far more resources than literally billions of people.  Most of the people in the world don’t have any access to medical help because there isn’t any, not because of cost.  And in the USA, we have several means of aiding people with issues that they can’t afford.

 

[notsosure]

"Not that I have lost any hope. All the goodness and the heroisms will rise up again, then be cut down again and rise up. It isn’t that the evil thing wins — it never will — but that it doesn’t die. I don’t know why we should expect it to. It seems fairly obvious that two sides of a mirror are required before one has a mirror, that two forces are necessary in man before he is man. I asked [the influential microbiologist] Paul de Kruif once if he would like to cure all disease and he said yes. Then I suggested that the man he loved and wanted to cure was a product of all his filth and disease and meanness, his hunger and cruelty. Cure those and you would have not man but an entirely new species you wouldn’t recognize and probably wouldn’t like." John Steinbeck

 

[WanderingRose]

But we’re not talking about bare subsistence for 90% of the worlds population, but in the United States.

I was responding to what sounded like fault finding that everyone can’t acquire a nest egg for retirement.

 

[WalkaboutTed]

"And in the USA, we have several means of aiding people with issues that they can’t afford."

After you have spent all your assets down to qualify for Medicaid. Unless you have the means to set up a trust to prevent that, i.e., you are a Haves or Haves More. And if you are on Medicare and have expensive drug costs? Just meds alone can push someone into bankruptcy.

It's easy to say that all kinds of help are available, until you are needing that help. Waiting lists for Section 8 in many parts of the country are years long. TANF? Try living on that. WIC or SNAP? Lots of hoops. When I was in my LAST semester of nursing school, I tried to get some help, just to pay for childcare. Instead, I was told that I would have to quit school to qualify for it. In this country, "Help" is often punishment, or at best a double edged sword.

Oh darn, I shouldn't have needed help for childcare if I couldn't afford it-my fault-I shouldn't have had children!
Ted

 

[Qxxx]

To support Ted and Rose, it's totally irrelevant to talk about living in Gambia or elsewhere, because people have to survive given the cost of living in the US. Even $6000 a year or $500 a month may about cover daily expenses, but not likely rent and utilities in this country unless you're living in a cardboard box under a bridge.

 

[WanderingRose]

We need more subsidized housing, also subsidized childcare for parents who are working or in school.

 

[sushidog]

"I was responding to what sounded like fault finding that everyone can’t acquire a nest egg for retirement." Wandering Rose

You're correct, Wandering Rose. I raided my retirement funds and went deeply in debt trying to save the life of my first DW. The doctors and I were successful, but it took many years to pay off all the debt - during which I was paying off high interest loans, not contributing to my retirement. Should I have just let her die to save my retirement funds? I think not.

But it is my responsibility to pay for my family's healthcare. I would not shirk from this duty and attempt to shift it to anyone else, as long as I am able, just as I would not expect anyone else to feed or care for my children, as they have their own family to take care of. I strongly believe in voluntary charity to help the less fortunate, however it is not the state's duty to play Robin Hood - stealing from the rich to give to the poor to accomplish this. It is our own sacred, individual responsibility to do so, just as it is our own responsibility to prepare for our retirement as best we can. IMHO

I'm now a retired full-time RVer. I bought an older used MH and live on social security - that my employers and I were forced to pay into for 45 years while I was working. Since I had no choice in the matter, I don't feel bad about taking what is owed. I live extraordinarily well for my meager income (which I am thankful for) and get to visit a lot of beautiful places I used to only dream of when I was working. I do this by effectively managing my expenses. I installed a couple 310 watt solar panels on the side of my MH earlier this year, which allows me to boondock a lot, (about 6 months this year) living a million dollar lifestyle in some of the most gorgeous locations imaginable, that I didn't even know existed, for pennies.

I am now wintering over at a very reasonable RV park in the RGV of TX, with a great bunch of fellow RVers. I'm only paying $170 a month + elec. for a nice, safe FHU site within a few miles of the border. The park residents get together in small groups a few times a month and visit Nuevo Progreso for inexpensive medical, optical and dental care. I recently purchased some meds for about 1/10th the cost of the same meds here - less than my old co-pay used to be when I was working and had prescription drug coverage. The tequila is about 1/2 of what it is here too. Life is good.

Chip

 

[mpruet]

To support Ted and Rose, it's totally irrelevant to talk about living in Gambia or elsewhere, because people have to survive given the cost of living in the US. Even $6000 a year or $500 a month may about cover daily expenses, but not likely rent and utilities in this country unless you're living in a cardboard box under a bridge.

You missed my point.  In the USA we have many social programs to help those with little income.  Most countries don’t have those.  Countries like The Gambia don’t have running water, indoor toilets, electricity, medical care, TV, internet, cell phones, etc.  Also they don’t have services like a food bank, Homes on Wheels, Habitat for Humanity, etc.  We also have basic health care for free while the majority of the world doesn’t even have health care professionals.  And yet we complain —- poor me...

 

[SLB_SA]

 Basic Subsistence???  Even the poorest in the USA are far more wealthy than over 90% of the world’s population.  

I spent some time in The Gambia where my son was in the peace corps.  I saw real poverty there, and there was no government aid. Yet the people were content and did just fine as they reached old age.

This video Living in the States compared to China - Live Stream is interesting.  The couple, Winston (from South Africa) and Sasha (from China), discuss being new parents and the differences between living in the U.S. and living in China.  One point that Winston makes is that discrimination in the U.S. cannot be compared with discrimination in many other countries; you should watch the video and let Winston speak for himself.

 

[crofter]

... fault finding that everyone can’t acquire a nest egg for retirement.

Yes exactly. Also selective memory. What housing bubble? What stock market crash? What robbery? What divorce? What company shipped overseas? What retirement fund fraud? What house that burned? What terminal illness that I survived, but my bank account did not? PPL commenting have not had those experiences yet.

Living good in a steel tent.   ~crofter