Will Policymakers Hurt or Help Your Retirement Plans in 2019?

Over the next 365 days, policymakers–at both the state and federal levels–have the potential to shape retirement for many for decades to come. Some such policy opportunities may be straightforward in impact while others may be more subtle and long-term. For example, how politicians and regulators go about handling any current economic issues could have affects on how people save currently as well as what future retirement costs may be. Another example might be whether a more liberal-leaning House of Representatives combined with similarly-situated state legislatures may turn their sights on programs such as Social Security and Medicare and look to shore up such programs so that they can continue to serve current and future generations. On the flip side, other legislatures with more conservative leanings may seek to cut into such programs, which may lead to higher future retirement costs and expenses. However, one area that there seems to be bipartisanship is expanding opportunities for American workers to save for retirement through the use of employer retirement accounts. Much of these efforts have focused on opening doors for small businesses to offer retirement savings accounts to employees that were in the past considered to costly for such employers. These are just a few of the ways that politicians and policymakers could impact retirement for you and those of younger generations. This post is also intended to encourage you to remain knowledgeable as to what is happening in both state and national legislatures and to understand how policies may impact you so that you can make the best decisions regarding your finances and retirement plans.

RMD and Small Business Retirement Plan Changes Could Be Coming

President Trump is expected to sign an executive order today that will direct the Treasury to review the rules on required minimums distributions (RMDs). The initiative directs the Treasury Department to review the rules regarding whether investors can keep more money in 401(k)s and IRAs for longer periods of time, most likely beyond the account owner turns 70½. If changes are made, they could allow for retirees to have more control over when they are required to begin taking money out of their retirement accounts. The executive order also focuses on small businesses and their ability to offer retirement savings plans to employees. The initiative would direct the Treasury and Labor Departments to work together to issue potential regulations that could make it cost-effective and efficient for small businesses to band together and offer retirement plans to their employees. While this executive order doesn’t necessarily mean that new rules or changes will definitely come about, it does mean that there could be some changes regarding what types of plans employers offer and how much time you have to allow your nest egg to grow. Stay tuned!