Insurable Interest Canadian Insurance Blog

Start Slideshow While many elements of the original Secure Act were applauded by the financial services community, that was not universally the case. A limited number of the law’s provisions were accepted as unfortunate but necessary “revenue raisers” to help offset the cost of implementing the retirement-related legislation. Among these was the provision that killed the so-called “stretch IRA” — i.e., the part of the law that sharply limited the distribution options for most individual retirement account beneficiaries who inherited accounts in 2020 or later. Post-Secure, most beneficiaries must now fully distribute the IRA assets and claim the proceeds as income for tax purposes within a 10-year window. Surviving spouses, however, were carved out as one of the few enumerated groups of individuals who continue to be eligible for taking inherited IRA distributions over their life expectancy — thereby stretching the IRA. This is not a surviving spouse’s only option, though, and the choices they make will affect the rate of distributions that must be taken from the inherited IRA. Because surviving spouses have limited time to choose their approach, experts warn, it’s important to ensure that clients understand their choices and the consequences. Clearly, the rules and options for...

Start Slideshow This week, two key congressional committees released identical discussion drafts of legislation containing technical corrections and other clarifications to be made to the Setting Every Community Up for Retirement Enhancement 2.0 Act of 2022, known in the retirement industry as Secure 2.0. While experts say it is normal for significant legislation to have technical drafting errors, the Secure 2.0 Act package included some big ones. One potentially disruptive error, for instance, would inadvertently disallow 401(k) catch-up contributions after 2024. Washington watchers tell ThinkAdvisor the push is already on to find a piece of must-pass legislation to which to attach the new Secure 2.0 corrections bill, and though it is a long shot, they hope the corrections will be adopted before the end of the year. This would allow the IRS and other regulators enough time to promulgate guiding regulations ahead of important implementation deadlines coded into the Secure 2.0 law. Ultimately, the corrections bill must be passed to ensure that the big retirement reform package functions as intended, but it is as yet unclear exactly when Congress will be able to advance the bill and send it to the president for signature. In the meantime, readers can review...

by Andreas Nienhaus, Steffen Rilling & Felix Orth, Oliver Wyman — Today, more than four billion people live in cities. By 2050, the United Nations (UN) estimates the number will grow to six billion, which amounts to adding eight cities the size of London every year. At that point, 70% of the world’s population will be urban dwellers. Cities will also account for 85% of the world’s economic output. This expansion is putting urban transport systems worldwide under intense pressure to accommodate the rising demand. Despite global urbanization, only half of the world’s population currently has convenient access to public transport. Specifically, 75% of the population has access to public transport in Europe and the United States, while only 33% have access in sub-Saharan Africa. This limits access to jobs and education and reduces overall social inclusion — unless an individual can afford to travel by a privately owned car. That alternative puts another strain on cities: The explosion of urbanites also has led to an explosion of congestion, pollution, and greenhouse gas emissions. Transport systems are intrinsically linked to the prosperity of cities. They affect quality of life, economic growth, social cohesion, and the environment. Transportation systems will also...