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    How Donald Trump’s Presidency Could Impact Retirement Rules

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    Readers had questions about individual retirement accounts, distributions and access to brokerage accounts if they moved away from the U.S. Here are some answers.Your retirement accounts may be the biggest component of your net worth. Or maybe those large balances are still only a goal, and you want to know if any changes coming in the next four years will help you get there — or get in your way.Of the 1,200 or so money-related questions we’ve received from readers in the days since the presidential election, many have been about retirement. We have some answers for what we know and context for what we don’t yet know. Most of them have nothing to do with Social Security; my colleague Tara Siegel Bernard answered questions about that program last week.But first, here’s an important caveat that is true in any administration, but especially in one like this: For things to change, President-elect Donald J. Trump has to want things to change, act on that desire and then succeed. If lawmakers are involved, they also have to have the desire, follow through and pass legislation.There will be plenty of noise, but in this particular category, it’s possible that not much of substance will look different four years from now.What did Mr. Trump say he wanted to change about individual retirement accounts or 401(k)s?Not much. Neither Mr. Trump’s campaign website nor the Republican Party platform that it pointed to said anything about I.R.A.s or workplace retirement accounts like 401(k)s, with one exception that probably wouldn’t affect many people.On his campaign website, Mr. Trump sounded off about environmental, social and governance, or E.S.G., funds and their place in workplace retirement plans. During his first term, the Labor Department issued a rule related to what sorts of funds an employer — which must act in employees’ best interest as a so-called fiduciary — can use in those plans.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Older Workers to Get ‘Super’ 401(k) Catch-Up Contributions in 2025

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      Workers who are 60 to 63 will be able to put in up to $11,250 in extra contributions, if they can afford it.Will you be age 60 to 63 next year? Lucky you! You have the option to contribute several thousand dollars more to your workplace retirement plan.That’s if you can afford it, and many workers will find it’s a stretch.Federal tax law already allows people 50 and older to make extra contributions, above the annual deferral limit, to a 401(k) or similar employer retirement plan. This year and next, that standard “catch-up” contribution is $7,500.But starting next year, the catch-up contribution limit will be higher for people in their early 60s, as part of the federal Secure 2.0 tax law passed in 2022. They can contribute up to $11,250 next year — an additional $3,750 in catch-up contributions — beyond the general 2025 deferral limit of $23,500, the Internal Revenue Service said. That means they can potentially contribute up to $34,750 in total to a workplace retirement account.This additional contribution — sometimes called an “enhanced” or “super” catch-up option — is available to workers ages 60, 61, 62 and 63. You’re eligible if you reach that age during the calendar year, said Dan Snyder, director of personal financial planning for the American Institute of Certified Public Accountants. (Once savers turn 64, they’re no longer eligible for the extra savings but can contribute the standard catch-up amount.)The idea is to give people who are nearing retirement age, but are behind in savings, the chance to accumulate more money for their post-work lives. “This is an opportunity to make up for mistakes from the past,” said David John, senior strategic policy adviser at the AARP Public Policy Institute, which focuses on issues relevant to older Americans.Getting Americans to save more for retirement is a concern as the population ages, especially as the number of companies offering pensions dwindles. The typical household headed by people ages 55 to 64 has just $10,000 saved in a retirement account, according to an analysis of federal data by the Economic Policy Institute and the Schwartz Center for Economic Policy Analysis.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      How a Retirement Withdrawal Can Lead to a Perjury Conviction

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      A prominent lawyer was recently sentenced to home confinement for falsely claiming hardship to withdraw funds. How desperate must you be to take money out?Sometimes, it’s illegal to spend money that you set aside for yourself.When you save money in many types of workplace retirement accounts, the Internal Revenue Service doesn’t collect income taxes on that money until it’s time to take it out, when you’re older.Need money before then? Certain types of “hardship” withdrawals are permissible. But you must have a very good reason, and you definitely can’t lie about it.Last week, a sentencing hearing took place after a rare case involving this sort of legal violation. Federal prosecutors had won convictions against Marilyn Mosby, the former Baltimore prosecutor who may be best known for pursuing charges against the police officers in connection with the death of Freddie Gray in 2015, for both impermissible withdrawals and making a false mortgage application when she bought a condo in Florida.Ms. Mosby will spend up to 12 months in home confinement, absent a successful appeal or a presidential pardon, which she has requested.Her case is a complicated one, given that the sentence isn’t just for impermissible withdrawals. And her false claim of financial hardship to withdraw money from her city retirement account took place during the coronavirus pandemic in 2020, when alternative, one-time-only rules were in effect.Still, hardship withdrawals are widely available.What follows are some questions and answers about what happened in Ms. Mosby’s case and what the rules actually are. Keep in mind that employers have a fair bit of discretion in how they set up the rules for their retirement plans, and there may be slight differences between the rules for 401(k)s, 403(b)s and 457 plans.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More