"When we refer to Secure 2.0, we're referring to legislation passed in late 2022 to expand retirement savings options. All of which helps make it easier for Americans to save by implementing features like automatic enrollment for new plans, adding penalty-free emergency withdrawals, and raising the age for Required Minimum Distributions (RMDs). It also aims to strengthen retirement security through enhanced catch-up contributions for older workers."
"Under the new rules, if you were born before July 1, 1949, your RMD starts at the age of 70.5. If you were born between July 1, 1949, and December 31, 1950, you must pull by 72. If you were born between January 1, 1951, and December 31, 1959, the age to pull RMD is 73. The goal is to give retirement savers more time for their money to compound before they're forced to withdraw funds."
Required minimum distributions (RMDs) apply to tax-deferred retirement accounts; original owners of Roth IRAs, Roth 401(k), and Roth 403(b) are exempt. Consult a financial advisor before calculating RMDs to avoid tax penalties. Secure 2.0 raised RMD ages based on birthdate brackets: age 70.5 for those born before July 1, 1949; age 72 for those born July 1, 1949–December 31, 1950; and age 73 for those born 1951–1959. The change provides more time for retirement savings to compound. If multiple accounts are subject to RMDs, calculate each account's RMD but total withdrawals may come from any individual IRAs. Secure 2.0 also reduced the missed-RMD penalty from 50% to 25%.
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