If you have been saving for retirement using a 401(k), you may be surprised at what you see on your next statement. The new “lifetime income illustrations” could leave you very disappointed. You also may want to make some adjustments based on what you learn from the new information.
SECURE Act Provisions
In 2019, when the SECURE Act (Setting Every Community Up for Retirement Enhancement) was passed, it required new information to be added to your regular 401(k) statements. Although the information will not be exact, it will give you an idea of how much retirement income you could receive each month, if you used your 401(k) savings to buy an annuity at age 67.CNBC gives an example of this, suggesting that individuals with $125,000 in their 401(k) may end up only getting $500 or $600 per month after retiring. Your statement may even show a smaller amount, but it will be based on what you have in your 401(k) at the time of the report. It does not include any future money you might put into the 401(k), money from Social Security, or any other retirement sources.
