Below are the provisions we believe to be the most impactful and it’s now time to begin planning. However, there is a lot more guidance we need from the IRS and Department of Labor before we can fully give analysis of the nearly 90 provisions and how they may impact you as an individual investor on a day-to-day basis. If you are a participant in an employer sponsored plan, guidance from record keepers and plan administrators is also required on how several provisions will be implemented.

Now it’s time to begin planning for provisions currently effective along with those slated for the coming years. Our list of the most impactful provisions listed by effective date is as follows.

Effective Immediately - 2023

• New exclusions to the 10% early withdrawal penalty - qualified disaster, qualified birth or adoption and terminally ill

• Employee may self-certify hardships

• Employers may permit Roth match

• Required Minimum Distributions (RMD) bumped to Age 73

• Simple and SEP Roth contributions allowed

Effective 2024

• Tax & Penalty Free Rollovers from 529 to Roth IRA - capped at $35,000 and account must be opened for 15 years.

• If earning > $145k, catch up contributions must be Roth (Note: a significant technical error in bill, if not fixed, would

eliminate the ability for 401(k) participants to make catch-up contributions in 2024. Treasury Department have been

altered)

• IRA catch-up of $1,000 begins to index with inflation

• Employer may match student loan payments

• No RMD for Roth 401(k) and 403(b)

• Retirement Savings Lost and Found

• New exclusions to 10% early withdrawal penalty - Emergency Distribution of $1,000 AND Domestic Abuse

Effective 2025

• Catch up contributions increased for savers ages 60-63

Effective 2026

• New exclusions to 10% early withdrawal penalty - Qualifying Long Term Care Insurance Premiums

Effective 2027

• Refundable Savers Credit - max of $2,000 for low-income savers. Credit deposited into retirement savings.

Effective 2033

• RMDs bumped to Age 75

We continue analyzing the provisions and will share comments as guidance is received. In the meantime, please reach out if you have questions.

The tax and legal references attached herein are designed to provide accurate and authoritative information with regard to the subject matter covered and are provided with the understanding that Rose Street Advisors is not engaged in rendering tax, legal, or actuarial services. If tax, legal, or actuarial advice is required, you should consult your accountant, attorney, or actuary.

Rose Street Advisors does not replace those advisors.

Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc. A Registered Broker/Dealer and Investment Adviser, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. File #: 5442889.1

Scott Higgins

AIF®, CFP®, CPFA® | Financial Advisor

Since 2012 at Rose Street, Scott has been responsible for helping the firm’s individual wealth management clients with income strategies for retirement and consulting with employers with their employee retirement plans. In free time, he enjoys golf, biking, skiing, cooking, and traveling. Fun fact, Scott has a hobby of filling growlers with coins!

Jeremy Heavey

AIF® | Financial Advisor

Jeremy has a professional track record starting, leading, and managing for-profit and non-profit organizations. He is a graduate of Taylor University and has completed business programs at both Hong Kong Baptist University & Harvard Business School. Jeremy is also formally trained and certified in behavioral assessment, conflict management and life coaching. Jeremy, his wife Kim and their 4 kids reside in Kalamazoo. They love spending time exploring the outdoors, fixing up their farmhouse, and living life with friends and extended family. Fun fact: Jeremy has been playing drums since he was 13 years old and made callbacks for the Blue Man Group.

Interested in more?

Let's Talk

You may have read about the SECURE Act 2.0 that passed in late December as part of the Consolidated Appropriations Act. This is the most extensive retirement plan legislation we have seen in years. The main objectives include increase the availability of retirement plans, help people save more, streamline retirement plan rules, and help individuals preserve income in retirement. The SECURE Act 2.0 has a plethora of provisions, some major and some minor; some mandatory and some optional; some retroactively effective and some won’t be effective for years to come. And some with unanswered questions. Below are the provisions we believe to be the most impactful and it’s now time to begin planning. However, there is a lot more guidance we need from the IRS and Department of Labor before we can fully give analysis of the nearly 90 provisions and how they may impact you as an individual investor on a day-to-day basis. If you are a participant in an employer sponsored plan, guidance from record keepers and plan administrators is also required on how several provisions will be implemented. Now it’s time to begin planning for provisions currently effective along with those slated for the coming years. Our list of the most impactful provisions listed by effective date is as follows.

Effective Immediately - 2023

• New exclusions to the 10% early withdrawal penalty - qualified disaster, qualified birth or adoption and terminally ill • Employee may self-certify hardships • Employers may permit Roth match • Required Minimum Distributions (RMD) bumped to Age 73 • Simple and SEP Roth contributions allowed

Effective 2024

• Tax & Penalty Free Rollovers from 529 to Roth IRA - capped at $35,000 and account must be opened for 15 years. • If earning > $145k, catch up contributions must be Roth (Note: a significant technical error in bill, if not fixed, would eliminate the ability for 401(k) participants to make catch-up contributions in 2024. Treasury Department have been altered) • IRA catch-up of $1,000 begins to index with inflation • Employer may match student loan payments • No RMD for Roth 401(k) and 403(b) • Retirement Savings Lost and Found • New exclusions to 10% early withdrawal penalty - Emergency Distribution of $1,000 AND Domestic Abuse

Effective 2025

• Catch up contributions increased for savers ages 60-63

Effective 2026

• New exclusions to 10% early withdrawal penalty - Qualifying Long Term Care Insurance Premiums

Effective 2027

• Refundable Savers Credit - max of $2,000 for low-income savers. Credit deposited into retirement savings.

Effective 2033

• RMDs bumped to Age 75 We continue analyzing the provisions and will share comments as guidance is received. In the meantime, please reach out if you have questions.

The tax and legal references attached herein are designed to provide accurate and authoritative information with regard to the subject matter covered and are provided with the understanding that Rose Street Advisors is not engaged in rendering tax, legal, or actuarial services. If tax, legal, or actuarial advice is required, you should consult your accountant, attorney, or actuary.

Rose Street Advisors does not replace those advisors.

Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc. A Registered Broker/Dealer and Investment Adviser, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. File #: 5442889.1

Scott Higgins

AIF®, CFP®, CPFA® | Financial Advisor

Jeremy Heavey

AIF® | Financial Advisor

Jeremy is passionate about partnering with individuals and families to identify what is important in their lives and creating a comprehensive financial strategy to help them reach their life goals. This holistic approach allows Jeremy and the wealth management team to ensure the specific needs of the client are front and center as they make investment recommendations and collaboratively design custom-tailored financial plans. Jeremy has a professional track record starting, leading, and managing for-profit and non-profit organizations. He is a graduate of Taylor University and has completed business programs at both Hong Kong Baptist University & Harvard Business School. Jeremy is also formally trained and certified in behavioral assessment, conflict management and life coaching. Jeremy, his wife Kim and their 4 kids reside in Kalamazoo. They love spending time exploring the outdoors, fixing up their farmhouse, and living life with friends and extended family. Fun fact: Jeremy has been playing drums since he was 13 years old and made callbacks for the Blue Man Group.

Interested in more?

Let's Talk

As you are aware by now, the SECURE Act 2.0 was passed in late December 2022 as part of the Consolidated Appropriations Act. It is the biggest retirement plan related legislation we have seen in years designed to accomplish four primary goals – 1) increase the availability of retirement plans 2) help people save more 3) streamline retirement plan rules and 4) help workers preserve income in retirement. SECURE Act 2.0 has over 90 provisions, some major and some minor; some mandatory and some optional; some retroactively effective and some won’t be effective for years to come. And some with unanswered questions. While we have listed what we see as the most impactful provisions, it is now time to begin planning. We are advising plan sponsors to first take a deep breath and understand the majority of everything that is in this will not be taking effect as of today because it requires additional guidance, processes and procedures. Yes, let’s look at it and let’s plan ahead. However, there is a lot more we need from the IRS and DOL before we can fully give analysis of the nearly 90 provisions and how this is going to impact plans on a day-to-day basis. In addition, more is needed on how various provisions will be implemented with recordkeepers and plan administrators. Our list of the most impactful provisions listed by effective date is as follows.

Effective Immediately - 2023

• Roth Employer Contributions • Small Incentives for Contributing to a Plan • Tax Credits • RMD Increased to Age 73 • Self-Certification of Hardship Distributions • Penalty Free Withdrawals for Terminal Illness

Effective 2024

• Required Roth Catch-Up Contributions • Penalty Free Withdrawals for Victims of Domestic Abuse • RMDs Not Required for Roth 401(k) and 403(b) • Emergency Withdrawals • Matching Student Loans • Force-Out Rollover Limit • Automatic Portability • "Side Car" Emergency Savings Account • Retirement Lost and Found

Effective 2025

• Improving Retirement Plan Access for Part-Time Workers • Automatic Enrollment and Escalation - Retirement Savings on Autopilot • Higher Catch-Up Limits for 60 - 63 Year Old Employees

Effective 2027

• Enchance and Promote Saver's Match We continue analysis of the provisions and will share comments as guidance is received. In the meantime, we will reach out to arrange a time for dialogue of which provisions may be appropriate for your plan and your employees.

Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc. A Registered Broker/Dealer and Investment Adviser, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. File #: 5442268.1

Scott Higgins

AIF®, CFP®, CPFA® | Financial Advisor

Interested in more?

Let's Talk

Can you picture your last day of work? What will you be feeling? What will you be thinking? What will be the look on your face when you leave work for the last time? My dad, John W Heavey, started as a firefighter on Sept 3, 1974 and worked hard for 33 years until he retired at the top of his game as Fire Chief on Sept 3, 2007. The picture above is on his last day as Fire Chief. From delivering babies, cutting people out of crushed cars, pulling people out of houses on fire, providing fire safety instruction to kids in schools, putting on SCUBA gear for water rescues, buying fire trucks and leading teams, he made a big impact! What an awesome career! While he was working, he was also emotionally, vocationally, and after meeting with a financial advisor, financially preparing for retirement. On his last day, he was content, grateful and confident, looking forward to the last day of work and the FIRST DAY of the rest of his life. He is now continuing his impact and legacy while enjoying his 16th year of retirement.

When we meet with clients, we often hear, “Do I have enough? How much should I be saving? Where should I be saving - should I just put my money in a target retirement fund? When can I retire? When should I take Social Security?” When you get to your last day, can you IMAGINE waking up with a grateful, humbly confident smile, knowing that you have worked hard and made a difference, AND are also financially prepared; ready to tackle that next season?

When we guide our clients through the Rose Street Advisors’ 7 Step Financial Life Planning Process, we have heard that they feel more confident, energized about the direction they are headed financially and have more peace, knowing a CLEAR path forward. Our team loves to FIGHT for our clients, developing plans and tax-efficient strategies to maximize every dollar they own. Are you over 50? Are you nearing retirement and would appreciate the confidence that comes from a complimentary review on your current financial life? Our team just kicked off Jan 2023 making a few tweaks to a client’s financial strategy and was grateful to share with the client that the changes would add hundreds of thousands of dollars to their net worth. It would bring us great joy to roll up our sleeves alongside you to develop a plan for the FIRST DAY of the rest of your life.

Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Advisor. Member FINRA/SIPC. Rose Street Advisors is independently owned and operated. #5434779.1

Jeremy Heavey

AIF ® | FINANCIAL ADVISOR

Fun fact: Jeremy has been playing drums since he was 13 years old and made callbacks for the Blue Man Group.

Interested in more?

Let's Talk

With the New Year comes New Year's Resolutions. If one is trying to reduce debt, here are a few ideas.

ARE YOU REDUCING YOUR DEBT? You’ve heard the phrase, “Slow and steady wins the race.” The same is true when it comes to reducing debt. Start with your smallest debt and then work on your larger debts. If debt is a leading contributor to your overall stress, you’re not alone. The national average for household credit card debt is $6,194.¹ The average total household debt, including mortgages, is $135,841.¹ That volume of debt can be a real burden on your wallet, relationships and ability to achieve other important goals like saving for retirement. TRY THE DEBT SNOWBALL METHOD Step 1: List your debts from smallest to largest. Step 2: Make minimum payments on all your debts except the smallest. Step 3: Pay as much as possible on your smallest debt. Step 4: Repeat until each debt is paid in full. Eliminating your smallest debt first and gaining momentum as each balance is paid off is the key to becoming debt-free. Soon, the second debt will follow, then the next, and repeat until you’re debt-free. Stick to the plan and begin leading a healthy progression toward reducing your debt. For more information on financial wellness, contact our retirement financial professional Scott Higgins at 269-552-3200 or shiggins@rosestreetadvisors.com. ¹Experian 2019 Consumer Debt Study. March 9, 2020 Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc., a Registered Broker/Dealer and Investment Adviser, Member FINRA/SIPC. Rose Street Advisors is independently owned and operated. Investor Disclosures: https://bit.ly/KF-Disclosures ACR# 4695358 04/22 File # 4847856.1

Scott Higgins

AIF®, CFP®, CPFA® | Financial Advisor

Interested in more?

Let's Talk

As we reflect on 2022, there were several market and economic hurdles that led to a stressful year for many of us. Some things are just out of our control. As we go into 2023, let’s focus on what we can control. When it comes to employer sponsored retirement plans, we often get questions from plan sponsors such as “How do we get our employees to participate? How can we provide a more competitive retirement plan that will allow employees to save more? What can we do to stress to our employees how important it is to begin saving for retirement now?” As a 401(k) participant myself as well as a retirement plan relationship manager, I want to help you take control of helping your employees by providing 5 tips of how to guide participants to save for retirement. Since I have started working in the retirement plan industry, I have noticed that a lot of younger employees don’t ask many questions about saving for retirement. On the other end of the spectrum, I have seen individuals reach retirement age, that have saved appropriately as well as those that have not and what a difference it can make in one’s life in retirement. Years ago, I had an elderly client come in and ask how she could get more money to be able to pay medical bills, when her retirement funds were diminishing. There wasn’t much that could be done, and it was heartbreaking to see the defeat and sadness in her eyes. She did not want to burden her family by asking for help, but social security just wouldn’t cover what was needed and her retirement funds were running out. This has always stuck with me and have since made it my mission to help people at any age understand the importance of retirement savings and how to prepare so that one day, they will be able to retire. The main goal for saving for retirement is to save a sustainable amount of money to replace/maintain income for your lifestyle. If you expect to travel, golf, dine out, buy a vacation home, etc. in retirement, you will likely need to save more money to prepare for that. The sooner a person starts saving for retirement, the more potential for long-term earnings growth in the account. How can YOU as the EMPLOYER help your employees understand how much to save? And what can YOU as the EMPLOYER do, to encourage your employees to maximize their retirement savings? In the following paragraphs, there are 5 tips that can help YOU as the EMPLOYER, guide participants to save for retirement.

1. Employer Matching Contributions

Providing employer matching contributions for employees will help encourage employees to save some of their own money for retirement by giving them the incentive to save at least enough to get the “free money” from their employer. Once employees are receiving the employer match, they are less likely to decrease their contributions so not to miss out on that “free money”. This is providing the opportunity for employees to save more for retirement.

2. Automatic Enrollment

An automatic enrollment provision can help employees get off to the right start by “making it easy” so they don’t have to lift a finger. Human nature is to take the easy way out and just not act on it, if we don’t fully understand it. By providing an automatic enrollment provision, the employee is defaulted into a pre-determined deferral percentage (e.g., 5%) unless the employee would want to opt out. In T. Rowe Prices’ white paper called Automatic Enrollment, Reenrollment, and Retirement Outcomes, Joshua Dietch wrote “T. Rowe Price analysis of participants who were automatically enrolled in employers’ plans in 2021 reveals that less than 6% opted out”. Understanding human nature and designing a plan to complement it may set up employees for better retirement savings from the beginning than if they never signed up.

3. Automatic Escalation/Increase

Typically, with the automatic enrollment provision, the automatic escalation provision is also added to encourage retirement savings. This provision allows for an automatic increase of 1% each year following participant enrollment. Employees will likely not notice a big difference in the amount they are saving for retirement if it’s only a 1% increase. My colleague and I were recently out at a plan sponsors office meeting with employees to review their accounts. Almost every conversation we had with employees involved the question of “what is 1% more?”. We asked employees what their gross pay is on their regular paycheck and calculated what different contribution rates were, in dollars. Speaking dollars rather than percentage contributions resonates more with employees. A common response when hearing the dollar amounts was in fact, “oh, that’s not as much as I thought” and “I can do that”. During the review of accounts, the majority of employees increased their contribution rates and signed up for the automatic increase feature that the recordkeeper offered on their website. If the plan provisions do not include automatic escalation, most recordkeepers have an automatic increase feature employees can sign up for, themselves. With annual raises, a 1% increase may not make much of a difference for employee paychecks but the additional savings for the participants will benefit them in the long run.

4. Employee Education

Employee education is a key component to prepare employees to save for retirement. As part of the retirement benefit, it’s important that employees learn what it is about and why it’s important. This can be accomplished through employee education meetings, employee newsletters, videos, and other resources. Amanda Umpierrez wrote an article in 401k Specialist Magazine, named Participants Admit Auto-Enrollment Kickstarts the Retirement Savings Journey, that provided statistics from a Principal study stating ”Despite the lack of knowledge, respondents indicated being open to working with financial institutions and experts. Seventy percent said they trust the financial institutions they work with, and 65% trust that their retirement plan service provider is helping them reach their retirement goals. Fifty percent believe their employer is doing all they can to help them save for retirement.” Seeing these numbers and that employees have trust in their employers and financial professionals, it’s important to lean on the experts to provide a better financial path forward for employees. This will prove to them that you do have their best interest in mind and begin that trust in the leadership of the company. The more awareness employees have of retirement savings, the better off they will be to start thinking more strategically about their financial future.

5. Financial Wellness Resources

There are more and more opportunities available since the world has become more virtual, allowing for online financial wellness resources and programs. Many recordkeepers embed financial wellness training and educational resources on the recordkeeper website. There are alternative companies such as Enrich, LifeCents, Financial Finesse, etc., that will partner with financial advisors to bring plan sponsors, access to more artificially intelligent programs that can target your employees’ specific needs. Through these programs, there is potential to incentivize employees to complete certain tasks while putting themselves in a better position long-term. I hope these tips help you to create a strategic plan for your company retirement plan and evaluate your current plan needs and wants. While we can’t control the market or the economy, we can control the retirement benefits we provide to employees. Take control in 2023.

This material and the opinions voiced are for general information only and are not intended to provide speciﬁc advice or recommendations for any individual or entity. To determine what is appropriate for you, please contact your Rose Street Financial Professional. Information obtained from third-party sources are believed to be reliable but not guaranteed.

Investments in securities involve risks, including the possible loss of principal. When redeemed, shares may be worth more or less than their original value.

By accessing any links above, you will be connected to third party web sites. Please note that Rose Street Advisors, LLC, is not responsible for the information, content or product(s) found on third party web sites.

Securities and Investment Advisory Services Offered Through M Holdings Securities, Inc. A Registered Broker/Dealer and Investment Adviser, Member FINRA/SIPC. Rose Street Advisors, LLC is independently owned and operated. File #: 5395125.1

JULIA MUNSON

AIF® | Retirement Relationship Manager

Meet Julia, a people-focused life-long learner with several years of experience in the retirement plan industry. Throughout her career, Julia has been committed to maintaining strong client relationships by providing incredible customer service. She is passionate about helping clients define and plan for their retirement goals. Julia’s daily role at the firm energizes and reinforces her commitment to client-focused work.

Interested in more?

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Setting Every Community Up for Retirement Enhancement (SECURE) Act 2.0

In 2019, the US Government voted on and passed a spending bill to help Americans save for retirement. The bill was called the Setting Every Community Up for Retirement Enhancement (SECURE) Act. Since then, there has been several updates discussed by congress and recently put into a revised act called the SECURE Act 2.0. The SECURE Act 2.0 was just passed at the end last year as part of the Consolidated Appropriations Act 2023 and signed by the President December 29, 2022. This is the enactment date and the effective date for some provisions of the Act. Other provisions will become effective over the next several years. How does this affect you? There are several updates like raising the minimum age for required minimum distributions, raising catch-up contributions, allowing for emergency withdrawals, matching student loan payments, expanded coverage for part-time workers and more. Out of the 4,100 pages of the SECURE Act 2.0, there is a lot to unpack in SECURE 2.0 and several provisions requiring clarification and/or interpretation while others requiring system updates.
We are reviewing the SECURE Act 2.0 in more detail and putting together a summary of the provisions by their effective timelines as well as a list of the top provisions we believe will have the highest impact for you, as our clients. We will be sending this out via email in the next couple weeks.
While there are several provisions that may benefit you, we believe SECURE 2.0 will initially raise more questions than answers for retirement plan sponsors and individual investors. If you have ANY questions about how this affects your employer-sponsored plan or you individually, please feel free to reach out to our team - we are always here to support you.

For Educational Purposes Only. This material is intended for informational purposes only and should not be construed as legal or tax advice and is not intended to replace the advice of a qualified attorney, tax advisor, or plan provider.

Securities and Investment Advisory: Services offered through M Holdings Securities, Inc., A Registered Broker/Dealer and Investment Advisor, member FINRA/SIPC. Rose Street Advisors is independently owned and operated. Rose Street Advisors is a member firm of M Financial Group. #5398793.10

Scott Higgins

AIF®, CFP®, CPFA® | Financial Advisor

Interested in more?

Let's Talk

Download Year-End Checklist

What Will You Retire To?

As the year wraps up, it’s natural to think about your goals – professionally, personally, and financially. It’s something that you and your household will want to assess and talk about openly and honestly. Use this year-end checklist to make sure you’re on track with your retirement savings goals.

○ Maximize your retirement savings - Consider converting to a Roth IRA or electing the Roth 401k

○ Review or update your beneficiary designations

○ Review tax withholdings

○ Review your insurance needs – life, home, auto and liability – make sure you’re adequately insured

○ Review your portfolio – diversify if need be or offset capital gains with capital losses (Tax-loss harvesting)

○ Plan ahead for education expenses

○ Check in on your emergency savings account

○ Fine-tune your budget – review your credit/debt

○ Think about your legacy goals/estate planning

○ Start preparing for the future

Whether you’re early in your career and building wealth, fine-tuning your future plans or prepping for life in retirement, there are things you may want to consider doing by Dec 31 to tidy you your finances.

If you have questions or need help, we are here for you. Reach out to Scott Higgins direct at (269) 552-3259.

Download Year-End Checklist

Scott Higgins

AIF®, CFP®, CPFA® | Financial Advisor

Interested in more?

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