Got Retirement Savings? You Really Need to Read This.

If you have an IRA. If you have a 401(k).If you worked for 30 or 40 years and quietly built something meaningful. This matters to you. Many people looking to retire in the next 4-10 years have the majority of their wealth in qualified retirement plans. The SECURE Act 2.0, passed in 2022, changed the rules about how retirement accounts are handled — not just during your lifetime, but after your death. The after-death changes are what will impact your spouse, children, or whomever you intend to benefit from your life's savings after your death. Sure, many people plan to spend and enjoy their retirement savings and that's great (in fact, that's what we love to see!), but the truth is none of us are guaranteed a long life. In cases where you die with considerable wealth, especially if it is held in retirement accounts, you need planning to maximize those benefits and minimize the harm to your family.

At Legacy Gurus, we see this play out in real life — not just in tax code language, but in families sitting across the table from us saying, “Wait… what do you mean we have to take all of this money out now?”

Let’s walk through this in a way that actually makes sense.

Story #1: “We Thought She Could Stretch It”

A few years ago, a mom came to us proudly. She had done her estate plan in 2015. Everything was “handled.” Her IRA named her trust for her daughter. Her daughter was responsible. Thoughtful. Not great with money, but improving. The plan was to “stretch” the IRA over her lifetime — small annual withdrawals, steady tax impact, long-term protection. That strategy made perfect sense under the old rules. Put simply, the daughter could continue to benefit from the investments of pre-tax money throughou tthe daughter's lifetime and withdraw minimally only what she needed.

Then the SECURE Act changed everything.

Mom passed away. The daughter inherited the IRA. Instead of stretching it over her lifetime like mom planned? She had to empty the entire account within 10 year - this is a consequences of the new federal rules. And because the trust language only allowed distribution of the “required minimum distribution” each year — and there was no annual RMD anymore — the trustee was stuck. For nine years, the money couldn’t be touched. In year ten? The entire account had to come out in one tax year, resulting in a massive tax bill in year 10. No one did anything wrong. The problem is the law changed, but mom's estate plan did not change with it.

Why This Law Matters More Than You Think

Retirement accounts are different from everything else you own.

They come with:

• Strict withdrawal rules

• Income tax consequences

• Beneficiary-specific timelines

When Congress changes those rules — your inheritance plan changes too. The SECURE Act 2.0 didn’t remove the biggest issue created in 2019:

The 10-Year Rule

Most adult children who inherit an IRA or 401(k) now must empty it within 10 years. Not stretch it over their lifetime. Not take small withdrawals. Empty it.

That means: If your child is in their peak earning years and thus already in a high tax bracket, and they receive an IRA or 401k, they will be pushed into an even higher tax bracket. The result is that you spent your life building tax-deferred wealth and your children will inherit an accelerated taxation. However, with careful and hollistic estate planning, the negative impact of the 10-year rule can be reduced.

At Legacy Gurus™, we help you make the most of a trust plan and work with financial advisors/planners to help you understand long-term impacts. Our trusted referral partners who are experienced in these areas make us uniquely positioned to provide the very best service to our clients.

Story #2: The “Responsible Son” Who Got Pushed Into a Higher Tax Bracket

We worked with a family in Massachusetts — two adult sons. One was a teacher. The other worked in tech. Dad had a sizable traditional IRA. The assumption? “They’ll inherit it and take distributions gradually.” But under the 10-year rule, the tech son — already in a high income bracket — had to coordinate withdrawals carefully or risk huge tax spikes. He called us in year 8.

“Do I take it now? Spread it out? What if tax rates go up?” No one had walked him through the strategy after Dad passed. This demonstrates the problem with not having a trusted advisor who is there for your adult children when something happens to you. Adult children who don't understand the tax implications of inheriting a retirement accounts are one of the most easily overlooked issues in modern inhertiance.

This is what we mean when we say estate planning isn’t just documents. It’s guidance for the people left behind.

Story #3: Outdated Trust Language

One of the most heartbreaking scenarios we see involves trusts that are made by lawyers who only dabble in this kind of planning, or worst, online do-it-yourself planning. Many families name a trust as beneficiary of retirement accounts to protect a child — maybe from divorce, creditors, or poor spending habits. That’s thoughtful. But if the trust language was written before 2020 or by someone who doesn't understand the new rules, it may reference outdated distribution rules or language that causes beneficiaries to have to accelerate pay out to just five years (v ten years).

We recently helped a family where an outdated trust would have caused the children to have to distribute the retirement accounts in five years as it did not preserve the 10-year stretch. While this outcome was prevented, we see equally as many people with outdated trusts come to us after the death of their parent and by then, it is too late to help.

If your estate plan has not been reviewed since 2019, it is time to have it reviewed.

This Is Why We Say: A Static Plan Fails

Most estate plans are signed and put in a binder. No review. No updates. No beneficiary coordination.

But laws change.

Families change.

Tax rules change.

A relationship-based estate plan evolves.

What We Do Differently at Legacy Gurus™

When we help families, we don’t just draft documents (although, we are VERY good at that!).

We:

• Review every retirement account beneficiary designation

• Identify 10-year rule exposure

• Analyze trust language for SECURE compliance

• Coordinate with financial advisors and CPAs

• Maintain a current asset inventory

• Provide regular 3-year reviews

• Support your family after death so they aren’t left guessing

Because the real test of your plan isn’t how it looks in a binder. It’s how it works when your family needs it.

The Hard Truth

Retirement accounts often represent the largest asset a family owns. And they are now the most technically complex asset to inherit.

Without proper planning:

• Your children could lose more to taxes than necessary

• Trusts could malfunction

• Trustees could be stuck

• Beneficiaries could make avoidable mistakes

• Stress could compound grief

We see this every year. And it is preventable.

The Better Way

The SECURE Act 2.0 is not a reason to panic. It’s a reason to review.

If your estate plan was created before 2020 — or even before 2023 — it deserves a check-up.

Not because you did something wrong. But because the rules changed. Your family deserves clarity, not confusion. Protection, not tax traps. Guidance, not guesswork.

Let’s Make Sure This Works

If you want to know:

• Whether your trust language still works

• Whether your beneficiaries are aligned with today’s tax rules

• Whether your retirement accounts are coordinated with your estate plan

• Whether your children would know what to do

We’ll look at what you have. How the law affects it. And what — if anything — needs to change.

Because the greatest gift you leave your family isn’t just money. It’s certainty. If you need help, schedule a free 15-minute call and we will help get you started.

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Amanda Wright is an estate planning attorney and educator who helps other attorneys confidently navigate the complex drafting implications of SECURE Act 2.0. That's why she knows how to help you.

She also the owner and founder of Drafting Gurus™. Through her training programs, workshops, and drafting support initiatives, she breaks down how the new rules impact retirement account planning, conduit vs. accumulation trust design, required minimum distribution (RMD) timing, eligible designated beneficiary classifications, and the income tax consequences of inherited qualified accounts.

Amanda focuses on practical drafting strategy — not just theory. She teaches attorneys how to:

• Analyze beneficiary designations in light of the 10-year rule

• Avoid common drafting traps in conduit trusts post-SECURE

• Structure discretionary and special needs trusts to preserve flexibility

• Coordinate retirement assets with overall estate planning goals

• Draft with clarity so trustees understand distribution standards

Her approach blends technical precision with real-world application, helping estate planning attorneys create documents that work under today’s retirement laws — not yesterday’s templates.