By Jasen Wallace, CFP®, Wealth Advisor

Financial regulations rarely stay the same for long, and each new law brings changes that affect retirement income, taxes and planning strategies. Some of those changes create opportunities, while others add complexity and risk. One of the roles of an advisor is to track these adjustments and guide clients through them so they can take advantage of favorable rules and avoid costly mistakes. Without that guidance, you could end up overpaying taxes or miss windows of opportunity.

One of the clearest examples of this challenge is required minimum distributions (RMD). RMDs are mandatory withdrawals from tax-deferred retirement accounts once you reach a certain age.¹ The starting age for these withdrawals has shifted several times in recent years. Under the SECURE Act 2.0,² individuals born between 1951 and 1959 must withdraw starting at age 73, while those born in 1960 or later start at 75. This creates a period of time before withdrawals are required when retirees may choose to make Roth conversions instead, which can help reduce future forced taxable withdrawals.³ Missing that window can mean paying more in taxes over the long term.

Inherited Individual Retirement Accounts (IRA) highlight a different set of risks. These are accounts passed down to a beneficiary after the original owner’s death, and come with their own distribution rules. Under the 10-year rule, most non-spouse heirs must fully distribute the account within a decade,⁴ and mismanaging that timeline can have major tax consequences. Taking only small amounts each year can lead to a large lump-sum withdrawal in the final year, often pushing the heir into a much higher bracket. Advisors help design distribution schedules that smooth out the tax impact and align with the heir’s broader financial picture. They also review how inherited accounts are invested, since too many are left in low-yield holdings by default.⁵ For a younger beneficiary, that can mean missing years of potential growth that would have made a meaningful difference. 

Charitable giving provides another planning opportunity that can be overlooked without guidance. Qualified charitable distributions can satisfy RMD requirements while keeping taxable income lower.⁶ For clients who are already giving, this approach is often more efficient than taking the distribution as income and then donating it.

The same is true for 529 plans, which are designed to help families pay for education expenses. Expanded rules now allow funds to be used for private school, trades and even Roth IRA rollovers if not needed for education.⁷ Many families still underfund these plans because they are working with outdated information, which is where advisors can provide clarity and structure contributions to fit with education goals.

Failing to adapt to these changes can carry consequences. Regulations are written and revised on a regular basis, which means the rules you planned under a few years ago may not be the ones in place today. Having someone monitor the rules, run the numbers and present options keeps your plan aligned with current law and prepared for the next change. That is where advisors add lasting value. Please contact your Exencial advisor if you have any questions about the changing financial regulations.

Sources:

1. IRS (12/10/24) - Retirement plan and IRA required minimum distributions FAQs
2. InvestmentNews (2/6/23) - SECURE 2.0 provides breathing room for RMDs
3. The Wall Street Journal (8/22/25) - What Trump’s Megabill Means for Roth IRA Conversions
4. Morningstar (4/3/25) - Inherited IRAs: What to Know About Taxes, RMDs, and More
5. Bankrate (6/20/25) - Inherited IRA rules: 7 things all beneficiaries must know
6. Kiplinger (3/31/25) - April RMD? Five Tax Strategies to Manage Your 2025 Income
7. Fortune (7/28/25) - New 529 plan rules let Gen Z invest in careers, not just college—and it reflects a seismic shift in education

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