We will be operating on shortened hours for the Holidays, please see our hours below:

December 24th 8:00 am to 12:00 noon

December 25th CLOSED

December 26th-31st 8:00am to 10:00am

January 1st CLOSED 

January 2nd Resume normal business hours

**Office will be open by appointment only. If clients are sending checks, please let us know in advance. 

The SECURE Act 2.0, passed in 2022, introduces several key retirement changes taking effect in 2025. One notable update is the “Super Catch-Up” Contribution, designed to help individuals nearing retirement boost their savings.

1. Higher Catch-Up Contributions for Ages 60-63 ("Super Catch-Up")

• Enhanced Limits: Individuals aged 60 to 63 can make increased catch-up contributions to 401(k), 403(b), or 457(b) plans.
• Amount: Up to the greater of $10,000 or 150% of the regular catch-up contribution limit (adjusted for inflation).
• Goal: Allows pre-retirees to boost savings during peak earning years.

2. Roth Catch-Up Requirement for High Earners

• Requirement: Employees earning over $145,000 annually (adjusted for inflation) must make catch-up contributions to a Roth account (after-tax), rather than pre-tax.
• Impact: Encourages tax diversification and provides tax-free growth for high-income earners.

3. Student Loan Payment Matching

• Provision: Employers can match qualified student loan payments as retirement contributions in a 401(k) or 403(b) plan.
• Benefit: Employees repaying student loans can still receive employer matching contributions, even if they can’t contribute directly to the retirement plan.

4. Emergency Savings Accounts Linked to Retirement Plans

• Feature: Employers may offer emergency savings accounts linked to defined contribution plans for non-highly compensated employees.
• Contribution Limit: Capped at $2,500.
• Purpose: Provides a safety net for emergencies without tapping into retirement funds.

5. Expanded Eligibility for Long-Term, Part-Time Workers

• Eligibility Change: Part-time employees working at least 500 hours per year become eligible for employer-sponsored plans after two consecutive years, down from three.
• Impact: Expands access to retirement savings for part-time workers.

6. Automatic Enrollment in New Retirement Plans

• Requirement: Employers establishing new 401(k) and 403(b) plans must automatically enroll eligible employees.
• Contribution Rates: Initial automatic deferrals start at 3% to 10% of salary, increasing by 1% annually until reaching 10% to 15%.
• Opt-Out Provision: Employees can opt out or adjust their contribution rates.
• Purpose: Boost participation and encourage consistent retirement savings.

Reach out to your advisor to see how these changes affect you and your financial future.

Happy Holidays from Capstone!!