Planning to reinvest those pesky required withdrawals from your individual retirement account or 401(k) plan because you don’t need the money?
Under the Secure Act, a bill pending in Congress right now that aims to improve the nation’s retirement savings, you’d have to start taking withdrawals from your IRA (and most other retirement accounts) at age 72 instead of 70 ½.
The kicker: Due to the reduced time that the reinvested cash would have to grow, its value over time could be smaller under the proposed change than under current law.
Allocating expenses into needs, goals and aspirations can help provide a better framework for managing your cash flow and living comfortably.
Pascal Broze | Getty Images
“You’d have more money in your IRA but less in the reinvested account,” said certified financial planner Mark Wilson, president of MILE Wealth Management in Irvine, California.
The chart below shows that for a theoretical IRA worth $500,000 at age 70, the reinvested required minimum…