The jigsaw puzzle that is the SECURE 2.0 bill passed by Congress could change the way you save for retirement, or the way your company handles its retirement benefits. But not all the pieces have arrived to make sense of it.

The bill has a slew of incentives that haven’t had rules established for them, warned tax adviser Raymond Kidwell, CEO of Kidwell & Associates in Bonita Springs and Fort Myers. “There’s not language written at the IRS on how all of this is going to take place and when all this happens,” Kidwell points out. “Things like where the employers are allowed to make retirement plan matches based on the student loan payments—that’s freakin’ awesome, but what are the details?”

The components of the bill go to the Internal Revenue Service for interpretation, and the rules they set up come back to Congress for approval and potential tweaks, he said.

There will be plenty of rules to write, too. SECURE—Setting Every Community Up for Retirement Enhancement—has components that touch nearly every type of retirement savings plan. Further, it has provisions for both the saver and the administrator.

What pieces of SECURE 2.0 might most affect Southwest Floridians? For Soren Christensen, owner of Advanced Wealth Advisors in Naples and Fort Myers, one of its best features is the change in ages that trigger a  required minimum distribution, or RMD—money retirees are obliged to start spending from their retirement plans each year.

“Before the SECURE Act 1.0 (in 2019), the RMD was 70 ½. SECURE 1.0 pushed that age to 72, and my clients were pretty happy about that because, regardless of political beliefs, people don’t want to pay any more taxes than they need to,” says Christensen. “The new act is going to push it to 73 in 2023 and, even more important, to 75 in 2033.  It’s going to help people who don’t need to tap into those retirement funds to save longer. I can’t tell you the stress clients have at the end of the year to make sure they get their RMD done,” he says.

Financial services firm Edward D. Jones has an automatic reminder set for its clients. Still, Christensen said, just the thought of the 50% tax penalty for those who don’t take their RMD is “pretty onerous.” Congress apparently agreed: SECURE 2.0 lowers the penalty to 25% for those who miss their RMD deadline. For those who make up the tardy expenditure, that penalty will be reduced to 10%, he said.

“This part is more advantageous for women because, first of all, they live longer, so they need more money to live than men,” says Coralia Boudreaux, an analyst with Edward D. Jones in Naples. “Statistically, they cannot save for retirement because maybe they’re taking time out of the workforce to take care of their kids. Also, because we all know many women aren’t paid as much as men for doing the same job, for these two reasons I think it’s hard for women to save for retirement. If we’re looking at women’s retirement accounts, I think women will really benefit from the age increase to 75 in the future.”

She also thinks women could benefit from the catch-up contribution allowance in their later working years. Between ages 60 and 63, employees with a retirement plan will be able to sock away as much as $10,000 a year into it, a $9,000 increase in permitted catch-up contributions. For those unable to contribute much in their earlier earning years, it’s a clear boon.

On the other hand, Kidwell, as an employer, sees 2.0 shoals to navigate for small business owners. Under SECURE 2.0, any retirement savings plan initiated by an employer after it goes into effect is obliged to begin matching employee savings at 3% and up to 10%. (The employee may put as much as 15% in the account, however, and if the employer so chooses, the company can match that.)

“Even at 10%, if you have 10 employees putting in 10%, that’s 100% (of a salary), and they come pretty quickly to the end of their budget,” he says.

There’s a relief valve for companies adding a retirement plan to their array of benefits in 2023: They’ll get 100% tax credit for the first year’s administrative costs, ratcheting that down by 25% each successive year. Depending their calculations, however, some companies may be rushing to create their benefit program before the new provisions take effect.