Edward Jones, one of the largest brokerages in the country, is making adjustments to give its legion of advisors opportunities to capitalize on the provisions becoming law in the long-awaited
The firm's advisors had been huge proponents —
Now Edward Jones is moving swiftly to analyze the new retirement laws for its army of financial advisors while it continues to roll out and enhance tools for brokers to provide holistic planning services to an
By helping clients take advantage of the many saving and
The firm is using data analytics software to identify, at scale, clients whose situations could benefit from SECURE 2.0's programs and rule changes, and nudging advisors to reach out.
"We're saying, OK, 300-plus pages, 90-plus provisions. How do we identify the opportunities that are most impactful for our financial advisors and clients?" said Lena Haas, the head of wealth management advice and solutions at Edward Jones.
Among the top priorities for Edward Jones advisors is helping clients who are nearing age 72 put their retirement funds to further work. Since the required minimum distribution age — the age at which Americans must begin taking distributions from their retirement funds to live off of — was raised in SECURE 2.0 from 72 to 73 this year, clients have a little longer to let nest eggs appreciate before dipping in.
Another is planning for certain types of long-term care insurance, to cover expenses such as nursing home stays, which became easier to save for under the new laws.
"With SECURE 2.0, it's great to see that it introduced the ability to pay for long-term care premiums, up to $2,500 a year from retirement accounts without any penalty," Haas said.
For clients who are in their 60s or older, "it's too much in terms of the premium commitment." So Haas and her team identifies clients who are in their 50s, a prime age to start considering such benefits, and encourages advisors to reach out to them and initiate discussions around that.
"Because that's the time where many folks are still in good health. And so you have the opportunity for many to ensure that plan upfront has relatively low premiums."
Among other things, the firm is also looking to identify families with children approaching college age for conversations about whether their 529 college savings funds could be rolled into Roth IRAs. One SECURE 2.0 provision allows for
"You are hugely impacting the life of the beneficiary," Haas said of families who can do this, adding that for new college graduates, "it's like awesome seed money that's going to grow over a really long term in a tax-deferred way."
Dan Zielinski, the chief strategic communications officer at industry trade group Insured Retirement Institute, said in an interview that firms were still scrambling to comply with the sudden last-minute passage into law of a bill that had been simmering for months.
"The way the legislation was written, [some provisions] were scheduled to be implemented almost immediately upon enactment, beginning of 2023," Zielinski said. "But not in every case can companies simply turn on a dime because people have to recalibrate systems, to issue reminders and [fulfill] other other requirements.
"This is something that the industry wholeheartedly endorsed," Zielinski added. Companies had anticipated the package with optimism for several months of the past year, "but sometimes that collides with short turnaround times when laws are passed."
He added that firms also couldn't proactively implement any legislation-dependent changes for their clients before a law passed, or they would risk being out of compliance.
