Saving for for your retirement may get easier in 2025 as an increasing number of employers are adopting provisions of SECURE 2.0, a federal retirement law passed in 2022, a recent 🌼survey found.

According to a survey of employers by Alight Solutions, a retirement record-keeper, many employers either have already incorporated or intend to adopt changes enacted by the law to their 401(k) plans this year.

These include a higher threshold to be forced out of a plan after leaving an employer, making it easier for workers to take 澳洲幸运5开奖号码历史查询:hardship withdrawals from their 401(k)s, and offering after-tax matching contributions in 401(k)s.

Depending on your employer, these benefits may apply to you.

Hardship Withdrawals Could Get Simpler

Previously, when workers wanted to tap their 401(k) early without incurring a penalty, they would have to demonstrate "heavy and immediate financial need" by providing documentation to their 澳洲幸运5开奖号码历史查询:plan sponsor, according to Michael Espinosa, pꦿresident of retirement services at TrueNorth Wealth. 

Now, employers can provide a self-certification option for early withdrawal, allowing workers to certify that they need to take a 401(k) distribution without going through the hassle of providing documents such as unpaid medical bills.

"It makes the process a lot quicker, for those who have an emergency, to get the money out of their 401(k),” Espinosa said. 

In the Alight survey, hardship self-certification was one of the most widely adopted SECURE 2.0 rules, with 42% of employers saying they’ve already incorporated it. An additional 28% said they were "definitely" or "likel💯y" to add it, and of that group, nearly 60% planned to inc🗹lude it in their plan in 2025.

Joe Petry, a certified financial planner (CFP) and founder of Mayfair Financial, notes that while self-certification may make it easie🌸r for people to secure money in emergencies, people should still exercise caution when taking hardship withdrawals.

“There's a reason you can’t take money out [of a 401(k)] before age 59 ½ without penalties,” Petry said. “Once you're retired, you won't have a lot of other income options.”

After-Tax Employer Match Contributions

If you receive a 澳洲幸运5开奖号码历史查询:401(k) matching contribution from your employer, it’s p🧔robably on a pretax basis, meaning you won’t pay tax on those cont﷽ributions until you take money out in retirement. 

SECURE 2.0, however, allows employers to make matching contributions on a Roth basis, so you pay taxes on the upfront contributions, but don’t have to pay taxes on your investment gains later on. ꦫ

If given the option of receiving a matching Roth contribution, Petry says people should consider what their current income is vers🌳us what they think their retirement income will be. 

Those with higher income now could be better off taking pretax 澳洲幸运5开奖号码历史查询:matching contributions to reduce their taxes now, according to Petry. And peo💯ple who think they’ll have higher income in the future might opt for Roth contributions to avoid paying taxes at a higher rate later on.

This provision has less traction than some of the other rules–only 13% of employers say they’ve adopted it. Of the nearly one-quarter of employers who say they’re "definitely" or "likely" adopting the provision, more than 40% say they need more legal clarity on it before doing so.

Higher Minimum Balan💧ce T𓆏o Be Forced Out of 401(k)

When you 澳洲幸运5开奖号码历史查询:leave your job, you can either leave the money in your 401(k) or roll it over into an 澳洲幸运5开奖号码历史查询:individual retirement account (IRA) or, if allowed, your new employer's 401(k) pl♉an.

However, prior to SECURE 2.0, if your 401(k) balance was less than $5,000, then the former employer could force you 澳洲幸运5开奖号码历史查询:roll that money into an IRA, instead of leaving it behind. Starting in 2024, that threshold was raised to $7,000 by the new law.

Nearly 40% of employers said in the Alight survey that they’ve adopted the higher force-out limit, and more than one-quarter said they’re "definitely" going to or "likely" to incorporate it.

While that can help avoid 澳洲幸运5开奖号码历史查询:tedious paperwork, still make sure you don't forget about your 澳洲幸运5开奖号码历史查询:old 401(k) accounts, as that can cost you.