I'm retired what does the CARES Act mean for me?
The Coronavirus Aid, Relief and Economic Security (CARES) Act brings new rules, different opportunities and relief for some. If you’re retired below are some ways it might impact you -
Required Minimum Distributions (RMDs) have been waived for 2020 - For those of you over 70 1/2, who have to take an annual RMD out of your IRAs or employer retirement plans each year don’t have to worry about taking it in 2020.
Recovery Rebates - that $1,200 individual check, or $2,400 for married couples, we’ve all heard something about. For some this check is a welcomed gift, but not everyone will get one. The amount of the check you will receive, if any, will be impacted by the income reported on your last filed tax return (it phases out entirely at $99,000 for singles with no children and $198,000 for joint taxpayers with no children). Technically, these rebates are a tax credit for the 2020 tax year, but they are expected to be received and paid in the coming months. If you’re getting a check you can likely expect it to be sent where you receive your social security checks (for those not getting social security, direct deposit to where you received your tax refund or your last address on file with the IRS).*
Small business owners - if you happen to still own a business there’s a lot in this package for you, you should work with your financial advisor to explore if and how you might leverage some of this relief.
HealthCare Related -
If you’re a Part D recipient you can now request up-to-90-day supply of medication.
If you have a Health Savings Account, you can now use your HSA to cover additional medical expenses such as over the counter medications.
On another note, we know being retired likely means you're taking money out of your investment accounts and a market drop like this one might bring new concerns and fears. So now is the time to focus on what you can control - one of your best allies in retirement is flexibility in your expenses. Take another look at your spending plans for 2020, make adjustments where you can to spend less. You’re likely going to travel less in 2020, consider taking less of a distribution to account for this. We all know we can’t control stock prices or interest rates, but we all can control how we respond.
As Christians we believe God is in control, but we also want to acknowledge that this is scary. So we continue to lean on him, follow biblical principles and walk in faith as he guides us to make sound financial decisions and stay focused on what we can control.
*To learn more about the Recovery Rebates visit -https://www.usatoday.com/story/news/politics/2020/04/10/coronavirus-who-doesnt-get-stimulus-check-millions-people-left-out/5112027002/
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