| Course | GF550 Retirement Planning |
|---|---|
| Unit | Unit 6 |
| Paper type | Seminar reflection |
| Length | About 820 words, 5 pages double-spaced |
| Format | APA 7 student paper |
| School | Purdue University Global |
| Program | MS in Finance |
| Updated | October 2026 |
Free sample paper for GF550 Unit 6
A Tax Increase, or Just a Change in Timing? A Unit 6 Seminar Reflection on the Roth Catch-Up Rule
[Student Name]
Purdue University Global
GF550: Retirement Planning
Unit 6 Seminar Reflection
[Instructor Name]
[Date]
The classmates are composite; the law, notice and article cited are real, and dollar figures are rounded.
The Rule
Workers aged 50 and older may contribute more to a 401(k) than the regular limit; in 2025 the extra catch-up amount is $7,500, and a larger amount applies at ages 60 through 63. A provision of the SECURE 2.0 Act requires that, for employees whose wages from the employer in the prior year exceeded $145,000, adjusted for inflation, those catch-up contributions be made as Roth contributions, taxed now rather than at withdrawal (SECURE 2.0 Act of 2022, 2022). The Internal Revenue Service delayed enforcement to give employers time to adapt, so the rule applies in practice from 2026 (Internal Revenue Service, 2023).
Where I Started
I came into the session calling it a tax increase on people trying to catch up on retirement saving. A 55-year-old earning $180,000 who used to deduct a $7,500 catch-up at a 24 percent rate would now pay about $1,800 more tax this year. It seemed to me that the law was raising revenue by taking a deduction away from savers.
The Sorting Exercise
Our facilitator asked us to stop arguing about the rule in general and sort savers into groups by what actually changes for them.
Group 1: Workers earning less than the threshold. Nothing changes. They can keep making pre-tax catch-up contributions.
Group 2: Higher earners whose plans offer a Roth option. Their catch-up becomes Roth. They pay tax now instead of later. Whether that costs them anything depends on their tax rate in retirement compared with today.
Group 3: Higher earners whose plans have no Roth option. Unless the employer adds one, these workers cannot make catch-up contributions at all. This is a real loss of saving room.
Group 4: Self-employed people without wages from an employer. The threshold is measured in wages, so a sole proprietor contributing to a solo 401(k) on self-employment income is not covered.
Where the Session Pushed Back
Priya pointed out that for Group 2, a Roth contribution and a pre-tax contribution of the same after-tax cost end up worth the same if the tax rate is the same at both ends. My 55-year-old at 24 percent today, who expects 22 or 24 percent in retirement, is roughly indifferent. The extra $1,800 of tax now is matched by tax-free withdrawals later.
Ben raised the behavioral side. Studies of firms that introduced Roth 401(k) options found that employees tended to contribute the same nominal amounts whether the dollars were pre-tax or Roth, which meant that Roth savers effectively saved more after tax (Beshears et al., 2017). If older savers keep contributing the same $7,500 as Roth, they end up with more spendable retirement money, not less.
For most higher earners the rule moves the tax from retirement to today rather than adding to it, and the people it actually hurts are a narrower group than I assumed: workers whose employers have not added a Roth option and who therefore lose the catch-up entirely.
Why the Government Wanted It
If the rule is mostly about timing, why pass it? The facilitator's answer was budget scoring. Congress measures revenue over a ten-year window, and Roth contributions bring tax in now while pre-tax contributions bring it in decades later, outside the window. The change looks like revenue on paper even though, over a saver's lifetime, it may not raise much at all.
How My Thinking Changed
I now see three separate questions where I had seen one. Does the rule change lifetime tax? For most savers, not much. Does it change when tax is paid? Yes, sooner. Does it remove anyone's ability to save? Only for those in plans without a Roth feature, until the employer acts.
What I Would Tell a Client
A client earning above the threshold should first ask whether the plan offers Roth deferrals. If it does, she should keep making catch-up contributions and treat the Roth balance as useful tax diversification. If it does not, she should ask the employer to add one and, meanwhile, save the catch-up amount in a taxable account or a Roth IRA if eligible.
A Number I Checked
To test Priya's point, I compared $7,500 deferred pre-tax with $5,700 contributed as Roth, the same after-tax cost at 24 percent, each growing 6 percent for ten years. Both end at about the same after-tax value if the withdrawal rate is 24 percent. At 22 percent the pre-tax version is ahead by under $300.
What I Still Want to Know
How many employers will simply drop catch-up contributions for high earners rather than add a Roth feature? That decision, not the rule itself, will determine how many people lose saving room.
References
Beshears, J., Choi, J. J., Laibson, D., & Madrian, B. C. (2017). Does front-loading taxation increase savings? Evidence from Roth 401(k) introductions. Journal of Public Economics, 151, 84-95. https://doi.org/10.1016/j.jpubeco.2015.09.007
Internal Revenue Service. (2023). Guidance on section 603 of the SECURE 2.0 Act with respect to catch-up contributions (Notice 2023-62). U.S. Department of the Treasury.
SECURE 2.0 Act of 2022, Pub. L. No. 117-328, div. T, 136 Stat. 5275 (2022).
Reading the GF 550 Unit 6 instructions
Unit 6 in GF550 pairs a seminar on a rule change with a written reflection. State the rule precisely, with its source and effective date. Describe the view you brought into the session. Then explain how the session analyzed the rule, especially any exercise that sorted savers by how the rule affects them. Record the arguments classmates raised, including any research they cited, and say which ones changed your mind. Distinguish effects on lifetime tax from effects on timing and on the ability to save. Check one claim yourself with a short calculation. State your revised view and what you would tell a client. End with an open question. Use your own voice, but back each point with the law, the agency's notice or a study, listed in APA 7, inside the seminar's length.
How the GF 550 Unit 6 example is put together
The rule, the 2025 catch-up amounts and the enforcement delay come first in the sample, citing the act and IRS Notice 2023-62. The writer's opening view, a $1,800 tax increase for a 55-year-old at 24 percent, follows. A sorting exercise produces four bolded groups, from earners below the threshold to self-employed people without employer wages. Priya's point about equal outcomes at equal tax rates and Ben's point, citing Beshears, Choi, Laibson and Madrian on Roth introductions, come next. The highlighted line then gives the narrower view the writer reached. The facilitator's answer about ten-year budget scoring explains why the rule was passed. A section separates three questions, client advice follows, a short calculation tests Priya's point, and the reflection ends asking how many employers will drop catch-ups.
Where the points sit in the GF550 Unit 6 rubric
Seminar reflections in GF550 are graded on accurate rule description and visible learning. Graders check that the rule, its threshold and its timing are stated correctly and cited. The largest share of credit goes to explaining how the session changed the writer's view, with each contribution attributed and evaluated. Separating lifetime tax effects from timing effects and from loss of saving room shows the analytical precision instructors in the MS in Finance course reward. A short independent calculation strengthens the reflection. Practical advice for a client demonstrates application. An open question that grows from the discussion, together with APA 7 references to the law, guidance and research, completes the grade.
Common GF550 Unit 6 mistakes, and how to avoid them
Many GF550 reflections on a rule change summarize the law and never say what the writer believed before the session. Others treat every taxpayer as affected in the same way, missing groups the rule does not touch or hurts most. Timing and lifetime tax are often confused, so a shift in when tax is paid is described as a tax increase without testing it. Research raised in the session goes uncited. Client advice is missing, leaving the reflection academic. If your seminar covered automatic enrollment, required distribution ages or a benefit formula change, keep the same structure: the rule with its source, your starting view, the sorting, the arguments, a check, a revised view and an open question.
Get a GF550 Unit 6 example written to your instructions
Name the rule change your GF550 Unit 6 seminar took up, or describe the assigned reading if the live session was replaced, and attach the rubric. The change is stated narrowly, savers are sorted by how it reaches them, and the closing position moves for a reason the session supplied. The first custom sample is free, normally inside 24-48h. The paper above is an original model document written by our desk, not a submitted student paper and not an official Purdue University Global document.
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GF550 Unit 6 questions, answered
Our seminar covered a different rule change. Does the approach still work?
Yes. Automatic enrollment requirements for new workplace plans, changes to catch-up contributions or a benefit formula adjustment all fit the same sorting approach: state the change narrowly, identify which savers it reaches and how, and record how your view moved. The sample uses the distribution age because it produces clear winners and a group it barely touches.
Where can I find a free GF550 Unit 6 sample paper?
A full GF550 Unit 6 seminar reflection on the Roth catch-up rule for higher earners is available here, sorting savers into four groups, with a revised view, client advice and APA 7 references.
Who loses the most under the Roth catch-up rule?
Higher earners whose employer plans have no Roth option. Unless the employer adds one, they cannot make catch-up contributions at all, which removes saving room rather than just shifting tax.
Are self-employed people covered by the rule?
The threshold is measured in wages from an employer, so a sole proprietor contributing to a solo 401(k) from self-employment income is not covered.
Why would Congress pass a rule that mainly changes timing?
Revenue is measured over a ten-year budget window. Roth contributions are taxed now, inside the window, while pre-tax contributions are taxed decades later, so the change scores as revenue even if lifetime tax barely moves.