SECURE Act: Insights from Newsday on Baby ‘Gift’
Newsday recently published an article featuring Matthew Wahler, discussing the implications of the SECURE Act’s provisions for new parents. The act allows early withdrawals from retirement accounts for child care without penalties, but the impact on long-term financial goals is a concern.
“The upside is someone can begin a family with a bit less stress, but the downside is that you are decreasing an existing tax deferred asset,” says Matthew Schechner, president of Essential Advisory Services. This highlights the potential long-term cost of accessing these funds early.
The provision allows parents to use up to $10,000 for child care costs without penalties, yet they must pay income taxes on withdrawals. This could ease immediate financial pressure but may compromise future retirement savings due to lost compounding interest.
Read the full article in Newsday.
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Matthew Wahler, CPA, Estate & Trust Principal at Kaufman Rossin, one of the Top 50 CPA and advisory firms in the U.S.
