What is the SECURE 2.0 Act and how does it affect my retirement plan?

The SECURE 2.0 Act of 2022 is a federal law that updated the retirement savings rules established by the original SECURE Act of 2019. It introduced a range of changes designed to help more Americans save for retirement, including new requirements for automatic enrollment in new workplace plans, expanded emergency savings options, and enhanced catch-up contribution limits for workers nearing retirement. Whether these changes affect you depends on your employer's plan, your income, and your age.

What is a pension-linked emergency savings account (PLESA)?

A PLESA is a short-term savings account that employers may optionally add to their 401k or 403b plans. Eligible employees — those earning below the highly compensated employee threshold — can contribute up to $2,500 per year in after-tax (Roth) dollars and withdraw funds for any reason without a penalty. Contributions count toward your overall 401k deferral limit, and the first four withdrawals each year are not subject to fees solely for making the withdrawal.

Should I opt out of automatic enrollment if my employer signs me up for a new 401k?

Automatic enrollment is designed to make saving easier by removing the barrier of having to sign up yourself. Before opting out, consider whether the default contribution rate works for your budget and whether your employer offers a matching contribution — one you'd lose out on by not participating. You're not locked in; you can always adjust your contribution rate up or down at any time to fit your financial situation.

Should I take advantage of the age 60-63 super catch-up contributions if my plan offers them?

If you're aged 60 to 63 and your employer's plan offers the enhanced catch-up limit, contributing up to $11,250 in catch-up savings in 2026 can meaningfully accelerate your retirement savings in the years when it may matter most. Whether it makes sense for you depends on your overall financial plan, cash flow, and tax situation. A Mercer Advisors wealth advisor can help you determine the right contribution strategy.

How do I find out if my employer offers a PLESA or the age 60-63 super catch-up contribution?

Start by checking with your company's human resources or benefits department to find out whether your plan has adopted these optional SECURE 2.0 features. You can also review your Summary Plan Description (SPD) — your employer is required to provide the SPD, which outlines the features of your retirement plan. If you'd like help interpreting what's available to you, a Mercer Advisors wealth advisor can review your plan documents with you.

Where can I get personalized guidance on how SECURE 2.0 changes affect my retirement savings?

Mercer Advisors provides comprehensive financial planning that includes retirement savings strategy, tax planning, and investment management. To discuss how SECURE 2.0 provisions apply to your situation, contact us to speak with a wealth advisor who can review your full financial picture and help you make the most of the opportunities available to you.

What’s the difference between a regular catch-up contribution and the new super catch-up for ages 60-63?

Both types of catch-up contributions allow employees age 50 and older to save beyond the standard annual deferral limit. The standard catch-up limit is $8,000 for 2026. The super catch-up — available only to those who turn 60, 61, 62, or 63 during the year — raises that limit to $11,250 for 2026. When you reach age 64, your limit reverts to the standard catch-up amount. The super catch-up is optional for plan sponsors, so availability depends on your employer's specific plan.

How does a PLESA compare to simply taking a hardship withdrawal from my 401k?

A PLESA is specifically designed to provide accessible short-term savings without affecting your retirement account. Hardship withdrawals from a 401k are subject to income taxes and, for those under the age of 59½, a 10% early withdrawal penalty — and they permanently reduce your retirement savings. PLESA withdrawals carry no such penalties, and your retirement account remains intact. If your employer offers a PLESA, it's generally a much less costly way to access funds in an emergency.

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Retirement Planning

Retirement planning is about much more than saving enough money — it’s about coordinating Social Security timing, Roth conversions, required minimum distributions, and retirement income strategy into a plan that can support the life you want to live. At Mercer Advisors, we help clients at every stage of their retirement journey, from early career savers to pre-retirees navigating the most critical decisions of their financial lives. Browse the resources below for evidence-based retirement planning guidance across tax, income, and investment strategy.

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