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September 04, 2019

These Proposals on Capitol Hill Could Affect Your Retirement

When Congress returns from its recess at the end of August, it will have three proposals to consider that will affect the future of retirement. Let’s take a look at each of these proposals and how they could impact you if you’re preparing for retirement or are already retired.


The SECURE Act (Setting Every Community Up for Retirement Enhancement Act) was passed in the House 417-3 in late May. The legislation could affect your ability to save for retirement and how you use those funds over time.

Here’s what you need to know:

It makes a change in the required minimum distributions (RMD): Currently, RMDs begin when you turn 70.5. With the new legislation, however, RMDs get pushed back to age 72, which allows you to grow your retirement savings a little more.

It puts no age restrictions on contributions to IRAs: The SECURE Act would repeal the rule that prohibits traditional IRA contributions from taxpayers 70.5 and older. The thinking behind this is that Americans are living and working longer and should be able to continue to contribute to a traditional IRA if they’re still working.

It creates 401(k) eligibility for part-time employees: Part-time employees aren’t usually allowed to participate in their employer’s 401(k) plan. If the SECURE Act is passed, it would guarantee 401(k) eligibility for employees who have worked 500 hours per year for at least three years.

The Social Security 2100 Act

Social Security trust funds will run out by 2035. As its name suggests, the Social Security 2100 Act aims to extend the solvency of Social Security into the year 2100.

Here’s what you need to know:

It raises non-Social Security income limits: The proposal would raise the limit for non-Social Security income before benefits begin to be taxed from $25,000 for individuals and $32,000 for couples to $50,000 for individuals and $100,000 for couples. To pay for these changes, payroll taxes would be raised on incomes over $400,000.

It increased payroll contributions: The bill calls for increased payroll contributions from employers and employees. The rate would increase from 6.2% to 7.4%, which translates into 50 cents more per week each year.

Rehabilitation for Multi-employer Pensions Act

The House passed the Rehabilitation for Multiemployer Pensions Act in July to address the dwindling multi-employer pension plans.

Here’s what you need to know:

It lets pensions borrow money: In order to help them remain solvent, the bill would allow pensions to borrow money. The bill would create a trust fund from which the loans are distributed and a Pension Rehabilitation Administration within the U.S. Treasury Department.

It could have trouble getting widespread support: It may have trouble getting support because it could be perceived as a bailout without reform.

More Information on the Bills

Read more about each of these bills and how they could affect your retirement in the links below.



The Social Security 2100 Act


Rehabilitation for Multiemployer Pensions Act https://www.congress.gov/bill/116th-congress/house-bill/397

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