At Winthrop, we help our clients live life in the moment while boldly exploring and imagining possibilities for their future. Our approach enables us to explore every aspect of your life so that we can design a big-picture plan and investment solutions that balance practicality with opportunity.
Whoever you are, and wherever you are on your journey, our multi-generational team has all the tools and experience to help you pursue your financial goals—and live your life to the fullest.
From fast-growing startups and closely held family businesses to multi-generational enterprises, we will help empower you to operate more efficiently day-to-day, while laying a foundation for navigating the future.
We work closely and collaboratively with our endowment and non-profit clients to provide investment programs and hands-on portfolio management services pursuing global opportunities while seeking to ensure alignment with key business objectives.
We’re committed to seeking out and sharing the trends influencing markets and the outlooks that might inform our investment approach. In an industry like ours, being open to multiple viewpoints and fresh perspectives is a critical part of how we add value, and help our clients imagine all the possibilities.
In the world of finance, things change fast and there’s always more to learn. We’ve created a series of tools that will help you stay educated and keep you informed about the things that matter most.
Updates | January 09, 2020
The Setting Every Community Up for Retirement (SECURE) Act was signed into law on December 20, 2019 and will have an impact on most retirement savers. Ultimately, the law focuses on retirement planning in three key areas: 1) modifying required minimum distributions (RMD) rules for retirement plans; 2) expanding retirement plan access and saving opportunities, 3) increasing lifetime income options in retirement plans.
It is anticipated that it will take a few months for additional clarity.
Some of the new rules and provisions of the SECURE Act are as follows:
Increased Required Minimum Distribution (RMD) Age:
One of the most significant changes is to what is referred to as “the stretch IRA”. Prior to the SECURE Act, beneficiaries who inherited retirement accounts could stretch the RMD over their lifetime. The SECURE Act changes that strategy for most non-spouse beneficiaries who inherit their retirement accounts on or after January 1, 2020.
Starting in 2020, a non-spouse beneficiary will not be able to stretch RMD’s over the beneficiary’s life expectancy and any retirement account will need to be distributed over a 10-year period instead of the beneficiary’s life expectancy.
The new stretch rules begin applying to those who have inherited an IRA after December 31, 2019. However, the following are exceptions to the new mandatory 10-year distribution rules:
We recommend reviewing your retirement plans and beneficiary designations with your advisor to explore how the SECURE Act may impact your current retirement and estate plan.
Elimination of the 70 ½ age limit for contributions to a Traditional IRA:
401(k)s for Part-time Employees:
Multiple Employer Plans (MEPs):
Increased Tax Credit for Small Business’s Retirement Plan Start-Up Costs:
The credit is available for three years and is in addition to the existing credit described above.
The credit is also available to small businesses that convert an existing retirement plan to an auto-enrollment plan.
Retirement Plan Annuity Option: The SECURE Act will encourage employers with retirement savings plans to let employees convert their savings into guaranteed life income, using annuities.
Our Planning Team can help explore if an annuity is a suitable option for you based upon your Financial Plan and retirement income needs.
The SECURE Act allows for an individual to withdraw up to $5,000 from a qualified retirement account following the birth or adoption of a child without paying a 10% early-withdrawal penalty.
Changes to Kiddie Tax Rules:
A major change of the SECURE Act is the repealing of the Tax Cut and Jobs Act of 2017 (TCJA) change to the Kiddie Tax rules. Under TCJA, a child’s unearned income is taxed at estate and trust income tax rates.
The SECURE Act repeals the TCJA change to the Kiddie Tax, reverting back to the rules that were in effect before 2018.
At Winthrop Wealth, we have a proactive approach to both comprehensive financial planning and investment management. Financial planning drives the investment strategy and provides a roadmap for each client’s unique goals and objectives. The comprehensive Financial Plan defines cash flow needs, optimizes account structures, considers tax minimization strategies, and continuously evaluates financial risks as circumstances and/or goals change. The investment management process is designed to provide well-diversified portfolios constructed with a methodology based on prudent risk management, asset allocation, and security selection.
As always, please contact us if you have any updates to your personal or financial circumstances or would like to discuss how the SECURE Act might impact your personal financial plan and retirement income needs.
This information is not intended to be a substitute for individualized tax advice. We suggest that you discuss your specific tax situation with a qualified tax advisor.
This information is not intended to be a substitute for individualized legal advice. We suggest that you discuss your specific situation with a qualified attorney.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment Advice offered through Winthrop Wealth Management, a Registered Investment Advisor and separate entity from LPL Financial.
No strategy assures success or protects against loss. Asset allocation does not ensure a profit or protect against loss. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.