Ladies and gentlemen, the weekend! In this space each week, Greg and I share some of our favorite articles, notes, and graphics from the past week along with our commentary. Please feel free to provide feedback and forward along to others if you enjoy. We appreciate you taking the time to read. 

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SECURE 2.0: Rethinking Retirement Savings

“The SECURE 2.0 Act is now law. The legislation provides a slate of changes that could help strengthen the retirement system—and Americans' financial readiness for retirement.

The law builds on earlier legislation that increased the age at which retirees must take required minimum distributions (RMDs) and allowed workplace saving plans to offer annuities, capping years of discussions aimed at bolstering retirement savings through employer plans and IRAs.

While SECURE 2.0 contains dozens of provisions, the highlights include increasing the age at which retirees must begin taking RMDs from IRA and 401(k) accounts, and changes to the size of catch-up contributions for older workers with workplace plans. Additional changes are meant to help younger people continue saving while paying off student debt, making it easier to move accounts from employer to employer, and allowing people to save for emergencies within retirement accounts.

Key takeaways

• The age to start taking RMDs increases to age 73 in 2023 and to 75 in 2033.
• The penalty for failing to take an RMD will decrease to 25% of the RMD amount, from 50% currently, and 10% if corrected in a timely manner for IRAs.
• Starting in 2024, RMDs will no longer be required from Roth accounts in employer retirement plans.
• Catch-up contributions will increase in 2025 for 401(k), 403(b), governmental plans, and IRA account holders.
• Defined contribution retirement plans will be able to add an emergency savings account associated with a Roth account.

The follow-up to the retirement plan-oriented SECURE Act snuck its way into the year-end omnibus spending bill and was signed into law on December 29, 2022. What most people are calling the SECURE Act 2.0 has quite a few provisions that will impact retirement plan accounts and retirement planning.

We will roll out more detailed information and some planning opportunities in a webinar and materials later this month, but this article was a nice recap on just a few of the changes.

The End of the Affair: 2023 Outlook



“The largest combined monetary and fiscal experiment in history is ending now, and a major growth slowdown is coming to the US and Europe. But: avoid the trap of becoming more bearish the lower the market gets, and be prepared to take advantage of selloffs when/if they occur…

In the history of US recessions (with the exception of the dot-com collapse of 2001), equity markets bottomed well before the bottom in GDP, payrolls, S&P 500 earnings and housing starts and the peak in household/corporate delinquencies. The ISM survey has been the most reliable coincident indicator of a bottom in equities, which is why we pay so much attention to it. If history is any guide, the equity bottom would also coincide with the end of Fed hikes.

I expect equity markets to bottom sometime in the first half of next year, and for the October 2022 lows to hold.

Our outlook begins with a discussion of leading indicators and what equity markets are pricing in already.

Leading indicators suggest that a major growth slowdown is coming to the US and Europe. Whether a recession technically occurs or not is beside the point; for equity investors, the slowdown ahead is likely to drag corporate profits down with it. We track manufacturing surveys closely since they’re good coincident indicators of a bottom in equity markets when recessions do occur… We expect a bottom in these manufacturing surveys in Q1/Q2 of 2023, and at levels that are above 2008 and 2020.

In other words, if there is a recession, we expect it to be a milder one than the last two. [Earnings leading indicator models] project the decline in S&P 500 earnings; our best guess is a 10%-15% [year-over-year] decline in S&P earnings in 2023.”

I take any 2023 prognostications with a grain of salt, but there are a few out there that employ a data-driven approach to markets and the economy. This is always one of my favorites of the year.

The conclusion was a slowing economy that bottoms softly. Be prepared to take advantage of equity market declines when they occur since a slowdown is already reflected in a lot of asset prices. 

"Here’s a final look at 2022 total returns for various ETFs across asset classes.  

30%+ Decliners:

• Nasdaq 100 $QQQ
• Consumer Discretionary $XLY
• Comm. Services $XLC
• 20+ Yr Treasuries $TLT"

Thanks for reading. Have a great weekend!

RBG Wealth Advisors LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.