The health emergency and the stock market drop-off is making life difficult for Houstonians preparing for retirement. However, Congress' Coronavirus bill has a few new changes that could make it a bit easier.
The Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, has several new provisions financial experts say can help you or your small business.
“The CARES Act is going to provide a lot of opportunity for a lot of folks that can respond quickly,” Bill Dendy, a money manager with Elite Financial Management, told KTRH.
Dendy notes several important changes. First, Required Minimum Distributions (or RMDs) may be suspended for 2020 to help investors rebound from stock-market losses. Investors normally must begin RMDs after reaching the age of 72 with IRAs and some 401(k)-style plans.
Another plus: withdrawal penalties are eased on 401(k) s and IRAs.
“The cost of all the stimulus is probably going to increase taxes down the road, so the idea of paying tax now when we are in a lower tax rate, when we don’t have quite as much income, that could be a major benefit,” Dendy explained.
Dendy urges you to contact an accountant or financial planner to discuss how the CARES Act could help you plan for the future.