A law passed in 2019 means your next 401(k) statement could come with a wakeup call. I’m Amy E. Feldman.
Back in December of 2019, the government passed a law that made changes to retirement accounts intended to help prevent older Americans from outliving their assets, just before the small matter of a global pandemic took our attention and long before inflation meant we could outlive our assets by dinnertime.
But starting the quarter ending June 30 of this year, the law says your quarterly 401 statement will not just give you the total of what’s in your account, it will also have to tell you what that means in terms of the monthly benefit your current account balance would provide at age 67. In other words, it’ll show you how much you’d get per month for life if you were 67 and retiring and you can decide if that’s enough. It doesn’t calculate how much you’ll contribute in the future and it can’t account for seismic global changes, but it might prod you to consider your savings before you’re ready to ride into the sunset.