How the CARES Act Affects Your Retirement

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We're living in unprecedented times. The rapid spread of COVID-19 has disrupted our daily lives. Consequently, Americans are increasingly concerned not only about their personal health, but also about the status of their finances.

Just as government officials have advised the public to stay home to stay healthy, BECU Investment Services is offering similar guidance for your investments: Stay informed, and don't panic. Here are a few things to keep in mind with regards to investing during this uncertain time.

Stay the Course

The most important thing to keep in mind right now is to avoid impulsivity. Even though the market is reacting erratically on a daily – and sometimes hourly – basis, your investing strategy doesn't have to change along with it. Consulting with a financial advisor may be beneficial in determining your best course of action, and BECU Investment Services is here to help.

Get Informed About the CARES Act

Part of the new Coronavirus, Aid, Relief & Economic Securities (CARES) Act, recently passed into law, focuses on retirement relief. Here are a few important pieces of the legislation that are worth noting:

• Required minimum distributions for 2020 are waived completely for IRAs and defined contribution plans. They do not need to be made up next year.
• It waives the 10% penalty tax on early withdrawals up to $100,000 for coronavirus- related hardship distributions.
• It exempts coronavirus-related distributions from the 402(f) notice requirements and mandatory 20% withholding applicable to eligible rollover distributions.
• It permits the individual to recontribute the coronavirus-related distribution within three years.
• Coronavirus-related distributions are distributions made during 2020 to an individual who is diagnosed with COVID-19, who has a spouse or dependent diagnosed with COVID-19, or who experiences financial consequences as a result of COVID-19.

Need Help? Talk to BECU Investment Services

No matter what your life situation looks like, financial advisors at BECU Investment Services can help. Working with a professional that can help guide you through these times of uncertainty can be invaluable, whether you need assistance building a financial plan, have questions about the CARES Act, or just want a second opinion. Credit union members and their financial wellbeing are our first and only priority.

To make an appointment, contact BECU Investment Services online or call us at 206-439-5720.