Overview of the Secure Act 2.0

The Setting Every Community Up for Retirement Enhancement (SECURE) Act was passed by Congress in 2019 to help individuals better prepare for retirement. The SECURE Act 2.0 was signed into law to address additional issues related to retirement and savings.

The Secure Act 2.0 is intended for resources in a 401 (k), 403 (b), or governmental 457 (b) plan who are eligible to save up to a maximum amount on a pre-tax basis each year. Plans also include catch-up contributions for participants who are 50 years of age and above and prefer to contribute more than the annual deferral limit on a pre-tax basis up to a maximum amount.

With the revised Secure Act 2.0, resources that earned $145,000 or greater in the previous year (FICA wage limit) can make contributions as Roth (after-tax) contributions.

Starting 2025, all new 401 (k) and 403 (b) plans established after Secure 2.0 is implemented are required to automatically enroll new employees at an initial contribution amount between 3 and 10%.