Secure 2.0 2024 Provisions Update

The Secure 2.0 Act of 2022 includes a range of provisions affecting employer-sponsored retirement plan coverage, retirement savings and more. While some of these provisions required mandatory adoption, many others were optional and left to the discretion of the plan sponsor. For optional provisions, NRECA, like other plan sponsors, must weigh the cost and risk of implementation without clarifying government regulations, expected utilization and relevance to plan design.

Two Secure 2.0 Act provisions have generated recent inquiries as to NRECA’s plans for implementation.

Higher 401(k) account catch-up contribution limits (sometimes referred to as “super catch up”). This optional provision allows for a higher catch-up contribution limit for 401(k) plan participants ages 60, 61, 62 and 63, beginning in 2025. Given the relatively small number of plan participants in this age group who are already taking advantage of the full contribution limit (including catch-up), NRECA has made the decision to defer implementation of this change to a later date to allow us to focus attention on other priorities.

Roth catch-up contributions for individuals aged 50+ making over $145,000 annually. This mandatory provision was to be effective on January 1, 2024, but the IRS permitted plans to delay implementation for a two-year period. As a result, this provision will go into effect January 2026 with the amount indexed for inflation.

NRECA continues to monitor additional optional provisions such as Roth employer contributions, auto-enrollment, emergency savings vehicles/account provisions, student loan matching contributions and provisions providing early access to accounts in extenuating circumstances. If you have questions about these provisions and applicability to your co-op’s benefit plans, please contact your local field representative.