SECURE 2.0 Act: Key Retirement Changes and What They Mean

Retirement planning has continued to evolve as lawmakers have introduced new rules around saving, investing, and accessing retirement funds. The SECURE 2.0 Act builds on these changes by addressing different stages of the retirement journey—from helping employees save more during their working years to changing how and when retirement funds can be accessed.

For individuals and business owners, understanding which provisions apply to their retirement plan can help them make better decisions about contributions, withdrawals, and long-term retirement planning.

What Is the SECURE 2.0 Act?

The SECURE 2.0 Act is a U.S. law passed in December 2022 that builds on the 2019 SECURE Act. It includes more than 90 changes aimed at helping people save for retirement, expanding access to workplace retirement plans, changing RMD rules, and making retirement plans easier for employers to manage.

SECURE Act 2.0: Other Changes Include the Following

The changes under SECURE 2.0 affect people at different stages of their working lives. Some are especially useful if you are close to retirement, while others are designed to help younger workers start saving and stay invested.

1. For People in or Near Retirement

• Higher Catch-Up Contributions
  

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People age 50 and older can make additional catch-up contributions to many workplace retirement plans.

SECURE 2.0 created an even higher limit for people who are ages 60 through 63. In 2026, eligible workers in this age group can contribute up to $11,250 in catch-up contributions to qualifying workplace plans, compared with the regular catch-up limit of $8,000.

There is also a Roth requirement for some higher earners. Starting in 2026, if you earned more than $150,000 in wages from the employer sponsoring your plan during the previous year, catch-up contributions generally have to be made as Roth contributions. The $150,000 threshold will be adjusted for inflation in future years.

IRA catch-up contributions have also been updated. The $1,000 catch-up limit for people age 50 and older is now indexed to inflation. For 2026, the limit is $1,100.

• Big Changes to RMDs
  

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Required Minimum Distributions (RMDs) are minimum amounts you generally have to withdraw from certain retirement accounts once you reach a certain age.

SECURE 2.0 pushed the general RMD starting age from 72 to 73 for people who reached the applicable age after 2022. For people who reach age 74 after 2032, the applicable age will increase to 75.

The penalty for missing an RMD was also reduced. It is generally 25% of the amount that should have been withdrawn, rather than the previous 50%. In certain situations, the penalty can fall to 10% when the missed amount is corrected within the required timeframe.

Another major change is that designated Roth accounts in workplace retirement plans no longer have lifetime RMDs while the account owner is alive. Roth IRAs already follow a similar rule.

These changes can give retirees more control over when they take money from their retirement accounts, but the rules can still vary depending on the type of account.

• Matching for Roth Accounts
  

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SECURE 2.0 allows employers to give workers the option of receiving vested matching contributions as Roth contributions.

Previously, employer matches were generally made on a pre-tax basis. With the new option, an eligible employee can potentially receive the match in a Roth account instead. That means the contribution is made after taxes, while qualified withdrawals from the Roth account can be tax-free.

This is an optional plan feature, so you will need to check whether your employer offers it.

• Qualified Charitable Distributions
  

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If you are at least 70½ and regularly give money to charity, SECURE 2.0 also expanded the options available for certain qualified charitable distributions, or QCDs.

For 2026, the annual QCD limit is $111,000. The law also allows a one-time QCD of up to $55,000 to certain split-interest charitable arrangements, such as a charitable gift annuity or charitable remainder trust. These amounts can count toward an applicable RMD, provided the distribution meets the QCD requirements.

The money generally needs to go directly from the IRA to the eligible charity or arrangement. Not every charity qualifies, so checking the rules beforehand is important.

• Other Changes for Annuities
  

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SECURE 2.0 also changed some rules around qualified longevity annuity contracts, commonly called QLACs.

A QLAC is a deferred income annuity purchased with certain retirement funds. It is designed to provide income later in retirement, potentially as late as age 85.

The premium limit increased to $210,000 and remains at that amount for 2026. SECURE 2.0 also removed the previous rule that generally limited QLAC premiums to 25% of an individual’s retirement account balance.

For someone worried about running out of money later in retirement, a QLAC can be one option worth discussing with a financial professional.

2. For People Years Away From Retirement

SECURE 2.0 is not only about people approaching retirement. Several changes are designed to make saving easier for workers who still have many years ahead of them.

• Automatic Enrollment and Plan Portability
  

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Starting in 2025, many newly established 401(k) and 403(b) plans are required to automatically enroll eligible employees, generally starting contributions at between 3% and 10% of pay, subject to the law’s requirements.

The idea is pretty simple. Instead of asking employees to actively sign up, the retirement plan starts saving for them automatically.

SECURE 2.0 also allows plan providers to offer automatic portability services. This can help move certain small retirement account balances into a new employer’s plan when someone changes jobs instead of leaving the money behind or cashing it out.

• Emergency Savings
  

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Retirement savings are easier to protect when you have money available for unexpected expenses.

SECURE 2.0 allows certain defined contribution plans to offer pension-linked emergency savings accounts. For 2026, the contribution limit is $2,600, unless the employer sets a lower limit. The first four withdrawals in a year can generally be made without tax or penalty under the applicable rules.

This gives employees a place to build short-term savings without immediately reaching into their retirement account.

• Student Loan Payments Can Count Toward Retirement Matching
  

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Student loan payments can make retirement saving difficult, particularly for workers who are just starting their careers.

Since 2024, employers have been allowed to treat certain student loan payments as if they were retirement plan contributions when calculating matching contributions.

That means you may be able to receive an employer retirement match even while putting your available cash toward student loan debt.

• 529 Plans Can Move Into Roth IRAs
  

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SECURE 2.0 also gives families another option for unused 529 college savings.

If a 529 account has been open for at least 15 years and other requirements are met, some of the money can be rolled into a Roth IRA for the account’s designated beneficiary.

The lifetime rollover limit is $35,000, and the transfer is still subject to annual Roth IRA contribution limits. Contributions or earnings that have not been in the 529 account for at least five years generally cannot be included in the rollover.

Also Read: 529 Plan Rollover to Roth IRA

• Disaster Distributions, Loans, and Hardship Withdrawals
  

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SECURE 2.0 also created additional options for people dealing with certain federally declared disasters.

Eligible individuals may be able to take up to $22,000 from qualifying retirement accounts as a disaster recovery distribution. The usual 10% early withdrawal tax may not apply, and the income can generally be spread over three years. Some people may also be able to repay the distribution.

If your plan permits it, you may also have access to a disaster-related 401(k) loan or hardship withdrawal. These options can provide needed funds, but taking money from retirement savings means losing the opportunity for that money to continue growing.

Closing Thoughts

The SECURE 2.0 Act changes more than just retirement contribution limits. It gives older workers additional ways to save, gives younger employees more opportunities to start saving, and adds flexibility around emergencies, student loans, and unused education savings. The important part is understanding which provisions actually apply to your situation and checking your specific plan before making changes.

Frequently Asked Questions About SECURE 2.0 Act