While many of the headlines about the SECURE Act have focused on permitting multiple-employer retirement plans for small businesses, expanding retirement plan eligibility to part-time employees and the potential inclusion of annuities in retirement plans, Simon said that the changes to IRAs are more dramatic.

For example, the measure eliminated the age cap of 70½ for traditional IRA contributions, which means Americans can now contribute to a traditional IRA at any age. It also extended the starting age for required minimum distributions from 70½ to 72.

“The bad news is the ‘pay-for’ for this version, because under House rules, if you propose something that’s going to cost money, [require] government expenditures or reduce revenue to the Treasury, which these proposals will do, it has to be offset by a ‘pay-for,’” said Simon. “The ‘pay-for’ in this measure estimated that it would cost a total of $16.6 billion dollars, and that would be covered by a measure that curtails the so-called stretch IRA technique that is used to stretch the taxation of [an inherited IRA’s designated beneficiary].”

Under the new legislation, the SECURE Act requires beneficiaries who inherit IRA assets to withdraw the entirety of those balances within 10 years. Before, the withdrawals could be “stretched out” for tax purposes.

Regulation Best Interest (Reg BI)
Since Congress is a non-player, more of the financial industry’s fate now falls in regulators' hands, said Simon, with the SEC’s Reg BI being the policy that most affects financial advisors.

Despite pending legal challenges to the regulation brought by a coalition of state attorneys general and the XY Planning Network, advisors should be prepared to abide by the June 30, 2020, deadline for compliance, said Simon.

“We’ll get to a decision, but I can’t tell you when,” he said. “There’s a chance the courts knock it down—the courts have not been reluctant to knock down agency rulemaking in recent years, but don’t count on it.”

The Ad Rule
The SEC has also signaled that it’s stepping in to modernize the “Ad Rule” guiding advisor marketing behavior.

The current rule, drafted in 1961, needs to be changed, said Simon.

“The rule was written three years before the fax machine and two decades before cable TV, three decades before Al Gore invented the internet, and of course before social media,” he said.