We are excited to share an important update regarding retirement savings, brought by Section 109 of the SECURE Act 2.0. This provision introduces a significant enhancement aimed at helping more Americans build their retirement savings effectively.
Key Highlights of Section 109:
Increased Catch-Up Contributions: Beginning in 2025, individuals aged 60 to 63 will be able to make increased catch-up contributions to their 401(k), 403(b), and governmental 457(b) plans. The new limit will be the greater of $10,000 or 150% of the regular catch-up amount for 2024.
Roth Requirement for Higher Earners: Catch-up contributions for employees earning over $145,000 (adjusted for inflation) must be made on an after-tax Roth basis, ensuring that savings are tax-efficient.
Inflation Adjustments: Both the enhanced catch-up limit and the income threshold for Roth requirements will be indexed for inflation, allowing for more savings as costs of living change.
This new provision is part of the broader SECURE Act 2.0 initiative to expand retirement savings opportunities and enhance financial security for all Americans. We encourage everyone to review their retirement plans and consider how these new rules might benefit them.
To understand how these changes might impact your specific situation, please contact us at info@riseretirement.com or 913.363.6401.
Click HERE to download a PDF copy of this notice.
For further information on Section 109 of the SECURE Act 2.0 please click HERE to view IRS Notice 2024-03.
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