If you are a typical American, you have likely spent time and energy to devise a well-planned retirement savings that is meant to protect yourself and your family for years to come. While there are many economical and financial factors that lead you to modify your retirement plan at times, the one thing you expect is that no one else can change it. This is only true to a certain degree. When the government gets involved, you can expect changes that impact your savings. In fact, as you read this, there are three government acts undergoing modifications that if approved would disrupt the retirement savings of many.
Proposed Government Act Modifications
Congress is reviewing three government act proposals: the Secure Act, the Social Security 2100 Act, and the Rehab for Multi-Employer Pensions Act. While there are some positive changes for some, the passing of these acts come with a price to others. The approved modifications to these acts could negatively impact those in the working class, small business owners, and investors that have worked hard to establish a significant retirement savings plan for their beneficiaries.
Impact of the Secure Act Proposal
The Secure Act, which stands for Setting Every Community Up for Retirement, passed in the House in May and it is now expected to pass in the Senate. While the intentions of the act are good in terms of helping Americans save for retirement, there may be some unfortunate results for those in certain situations. The act proposes these changes, many of which could actually reduce the value of retirement savings accounts.
- Investors/Retirees/Beneficiaries: For IRAs, 401(k) plans, 043(b) plans, and other retirement plans, the required minimum distribution (RMD) age will change from age 70 ½ to 72; also removes the maximum age limit of 70-1/2 for traditional IRA contributions; stretch IRAs for non-spousal beneficiaries will be eliminated; beneficiaries would have a ten-year time limit to defer their distributions and income taxes based on inherited IRAs.
- Employees: More annuities would be offered in 401(k) plans; part-time workers could also participate in 401(k) plans.
- Employers: These extended provisions may be costly for employers and small business owners; employers could be required to match contributions for compliancy with state and federal laws.
The RMD age modification and the IRA age limit adjustment may help some but not all investors.
With the elimination of the stretch IRA, inheritors would pay higher on sizable retirement plans. The value in compounding IRA investments across beneficiary lifetimes will not be an option.
Impact of the Social Security 2100 Act Proposal
The Social Security 2100 Act was introduced this year by Representative Larson (D-Conn) to prevent the Social Security program from failing, since the funds are expected to run out by the year 2035. If this were to happen, retirees could draw only 80% of their contributions made over the years. The Social Security 2100 Act is designed to assist by increasing payroll taxes at both the employer and employee level, from 6.2% to 7.4%. Workers would have lowered wage increases and in turn lowered retirement contributions. The act, made to secure adequate Social Security benefits, would mean workers today would have less. Retirees still might not be able to claim the funds they deserve and hoped to save.
Impact of the Rehabilitation for Multi-Employer Pensions Act Proposal
America’s pension plans are today at a high risk of disappearing, impacting about 1.3 million people. Given this, the government passed the Rehabilitation of Multi-Employer Pensions Act that would allow any under-funded pension plans, borrowed money in order to continue to pay deserving retirees. While this sounds like a promising plan, some politicians believe that this method in the long run would hurt businesses, union workers and taxpayers.
Why Gold is a Promising Investment for Retirement Savings
Unfortunately, with the passing of these bills, American investors may be the ones that feel the pain. The truth about these proposed acts presents a strong case as to why gold is a promising investment for retirement savings. A precious metals investment is not subject to these precarious government solutions. As a business owner, member of the working class, or new retiree, your investment savings is one of the most important aspects of your future security. Your assets should not be a matter of compromise. You should be able to establish a retirement savings that will take you into your senior years and contribute to your beneficiaries in the way you expected it to. There is sound money in a gold or silver investment, whereby you avoid the penalties and misunderstandings of these government interventions.
Who Is Stockpiling Gold
According to Business Insider, countries with the largest gold reserves include the United States, Germany, Italy, France, Russia, China, Switzerland, Japan, Netherlands and India. China is the largest consumer of gold. In an article at ZeroHedge, it was noted, “China, Russia, and other countries are taking advantage of the Federal Reserve’s policy by buying gold on the cheap.” Before the prices rise even more, it’s time for Americans to get on board. The article also notes, “The world is edging toward increasing instability and possibly financial chaos. US investors are already divesting themselves of portions of their stock portfolio in preparation of potential losses.” Now is the time to get the truth. Schedule a consultation with Reagan Gold Group, and get your investment portfolio in order now. Find out how gold can supplement your portfolio.