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Liz Weston

Thursday’s need-to-know money news

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Today’s top story: Who should consider a Roth conversion now? Also in the news: Morgan Stanley’s new cash account, how to make a savings plan, and an important student loan deadline.

Who Should Consider a Roth Conversion Now?
The Secure Act brings new options.

Should You Check Out Morgan Stanley’s New Cash Account?
A look at the benefits.

How to Make a Savings Plan
A roadmap to a better financial life.

Don’t get caught by surprise by this deadline if you’re paying off student loans
Time to re-certify your income.

Wednesday’s need-to-know money news

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Today’s top story: How to have a ‘no regrets’ retirement. Also in the news: How to sell your car to family and friends, the debt payoff method that can also help your credit, and your last chance to file an Equifax breach settlement claim.

How to Have a ‘No Regrets’ Retirement
Putting off travel, buying a retirement home too hastily and not discussing expectations are common mistakes.

How to Sell Your Car to Tough Customers: Friends and Family

The Debt Payoff Method That Can Help Your Credit, Too

Today (Wednesday) is Your Last Chance to File an Equifax Breach Settlement Claim
A few more hours to submit your claim.

Tuesday’s need-to-know money news

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Today’s top story: 4 things to know if you’ve never budgeted before. Also in the news: Equifax breach – claims cutoff and more scammers ahead, how auto insurers use your nondriving habits to raise prices, and the benefits of filing taxes early.

4 Things to Know if You’ve Never Budgeted Before
Breaking down the basics.

Equifax Breach: Claims Cutoff and More Scammers Ahead
The fallout continues.

How Auto Insurers Use Your Nondriving Habits to Raise Prices
Your grocery shopping could raise your auto insurance.

The Benefits of Filing Taxes Early
There are good reasons to file early.

Who should consider a Roth conversion now?

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If you’ve saved a lot for retirement, or your parents have, you could be affected by recent changes in the rules about retirement distributions.

The recently enacted Secure Act eliminated the “stretch IRA,” a strategy used by affluent investors to pass tax-advantaged money to their heirs. The stretch IRA allowed nonspouse beneficiaries — typically children and grandchildren — to take money out of an inherited IRA gradually over their lifetimes. The new law requires most IRAs inherited by people other than spouses to be drained within 10 years, which can lead to much higher tax bills for heirs. (Spouses still have the option of treating an inherited IRA as their own and taking money out over their lifetimes.)

At the same time, the Secure Act delayed when required minimum distributions have to begin for most retirement account owners, increasing the age for mandatory distributions from 70 1/2 to 72. In my latest for the Associated Press, why financial planners say the changes make a Roth conversion attractive for big savers.

Q&A: New Secure Act changes some retirement rules

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Dear Liz: At age 70½, when I must withdraw money from my IRA, may I donate those dollars to a charitable organization without paying tax on the withdrawn funds?

Answer: The short answer is yes, but you should know there have been some recent changes to retirement plan rules.

Required minimum distributions now start at 72, thanks to the recently enacted Setting Every Community Up for Retirement Enhancement (Secure) Act. If you turned age 70½ in 2019 and started your required minimum distributions, you should generally continue, but talk to a tax pro.

Also, you can now make contributions to your IRA after age 70½, as long as you’re still working. You must have earned income at least equal to the amount you contribute.

The law didn’t change when you can begin making qualified charitable distributions from your IRAs. Once you reach 70½, you can donate up to $100,000 each year directly from your IRA and the donated amount will not be included in your income.

If you make IRA contributions after age 70½, though, those contributions are deducted from the amount you can donate.