Retirement Planning in 2023: 

Understanding the SECURE Act 2.0

It is crucial to understand the SECURE Act 2.0 for retirement planning. Staying up-to-date with the latest laws and regulations is essential in making informed decisions about your finances. Congress passed and signed the new law into effect on December 29, 2022. The SECURE Act 2.0 has important implications for retirement planning, especially for annuities.

Update Secure Act 2.0 – RMD

The SECURE Act 2.0 is a new law that may affect your retirement planning. A critical change in the SECURE Act 2.0 involves Required Minimum Distributions (RMDs). These are payments that you’re required to take from your retirement savings accounts, like 401(k)s or IRAs, once you reach a certain age. The SECURE Act 2.0 updates the rules around when you need to take these payments and how they’re taxed.

The age when RMDs must be taken has increased from 72 to 73 for people who turn 72 after 2022. People who turn 72 in 2023 won’t have to take RMDs until they are 73. But those who turned 72 in 2022 must take RMDs for 2022, and their first distribution must be taken by April 1, 2023.

The SECURE Act 2.0 has also changed the penalty for not taking RMDs. Before, if you didn’t take out a certain amount of money from your retirement account, called the required minimum distribution, you would have to pay a tax of 50% on the amount you should have taken out. But now, under the SECURE Act 2.0, that tax has been lowered to 25%. If you meet specific requirements, the tax can be reduced even more to 10%.

 These requirements are:

  • You take out the amount of money you missed during a specific period called the “correction window.”
  • You take the money out of the (same) type of retirement account from which you missed the required minimum distribution.
  • You correct the mistake by submitting a form during the correction period.
  • You meet the deadline, which is the earliest of three possible dates: the date the tax notice was sent, the date the tax was assessed, or the last day of the second full year after the tax was imposed. 

Retirement planning can be complicated. Working with a financial professional who can help you understand the changes in retirement laws and regulations is essential. If you manage your retirement savings, consider these changes when planning your withdrawals. Stay up-to-date with the latest retirement news, and seek help from a qualified professional if you need it. By staying informed and making smart financial decisions, you can prepare for a comfortable retirement that meets your needs and goals.


The age to start taking RMDs will increase to 73 in 2023 and 75 in 2033.


Starting in 2024, RMDs will no longer be required from Roth accounts in employer retirement plans.


The penalty for failing to take an RMD will decrease to 25% of the RMD amount, from 50% currently, and 10% if corrected on time for IRAs.

Emergency Savings

Defined contribution retirement plans will be able to add an emergency savings account associated with a Roth account.

Changes that might 

affect your retirement!

    • Starting Jan 1, 2023, the RMD age limit will be increased to 73 from 72.
    • The penalty for not taking RMD will decrease to 25% from 50%.
    • Roth accounts in employer retirement plans will be exempted from RMD requirements starting in 2024.
    • For in-plan annuity payments that exceed the participant’s RMD amount, the excess annuity payment can be applied to the year’s RMD.