Working clients and families now face one of the most opportunity-rich planning environments in years. The One Big Beautiful Bill Act (OBBBA) and SECURE Act 2.0 locked in lower individual tax rates, expanded family benefits, enhanced retirement and health savings tools, and reintroduced complexity around income thresholds and phaseouts.
This combination rewards advisors who move beyond reactive advice. Clients no longer benefit from isolated recommendations around retirement contributions or tax filing. They need coordinated planning that integrates income, benefits, taxes, savings, and long-term goals across multiple stages of life.
Below, we outline six planning items for working clients and families.
1. Start with tax clarity and income planning
OBBBA permanently extends the individual tax brackets created under the 2017 Tax Cuts and Jobs Act. Marginal rates remain unchanged, with the top bracket staying at 37%. The standard deduction also increases in 2026 to roughly $16,100 single and $32,200 joint.
Taxpayers age 65 and older receive an additional $6,000 per eligible individual through 2028, increasing the total deduction to $24,000 for a single senior and $47,470 for a married couple where both spouses are 65 or older for 2026. This enhanced deduction begins to phase out at $75,000 of income for single filers and $150,000 for married couples filing jointly, and is fully eliminated at $175,000 and $250,000, respectively.
Pro tip: With all this opportunity, phaseouts will still drive some short-term outcomes. Expanded deductions, credits, and benefits can disappear quickly as income rises. Advisors must model not just tax brackets, but effective marginal rates created by lost benefits when doing tax planning. Try to avoid the tax torpedoes.
2. Manage MAGI to protect ACA credits
For many working families, healthcare affordability now depends directly on income planning. The Affordable Care Act premium tax credit subsidizes marketplace health insurance premiums based on Modified Adjusted Gross Income (MAGI).
Beginning in 2026, the enhanced subsidies expire and the original income cliff returns. Households with income just above 400% of the federal poverty level, roughly $62,600 for a single filer or $128,600 for a family of four, can lose the credit entirely, possibly costing up to $1000 a month or more in additional premiums. This means that households that exceed this threshold lose the credit entirely. There is no gradual phaseout. Once income crosses the line, the subsidy drops to zero, and families must pay the full, unsubsidized premium, which can increase annual healthcare costs by tens of thousands of dollars in a single year.
The financial impact can be substantial. The typical enrollee with subsidized ACA coverage is projected to see a 114% increase in premium bills, rising from an average of $888 per year in 2025 to $1,904 in 2026, according to The Wall Street Journal. For many middle-income households, especially older enrollees or those in high-cost states, the increase can be far larger. In some cases, a modest income increase from a bonus, capital gain, or Roth conversion can eliminate subsidies altogether and force families to pay full, unsubsidized premiums.
Advisors should proactively model MAGI each year, particularly for households with variable compensation, self-employment income, or early retirees bridging to Medicare. Traditional planning tools such as retirement plan contributions, HSAs, and FSAs remain among the most effective ways to decrease MAGI while improving tax efficiency and long-term outcomes.
Pro tip: ACA planning is income planning. Test how incremental income affects subsidies and net healthcare costs before recommending raises, Roth conversions, or sales leading to capital gains.
3. Revisit employee benefits and compensation every year
Workplace benefit plans often contain overlooked planning opportunities, especially after the changes introduced by SECURE Act 2.0. Advisors should review each client’s benefits annually, and not just at job changes, as employers frequently add or modify features midyear.
Key areas to review include after-tax 401(k) contributions, Roth employer matches, deferred compensation plans, employee stock purchase plans, and student loan repayment benefits. After-tax 401(k) contributions can create opportunities for in-plan Roth conversions, while Roth employer matches allow clients to receive tax-free growth on employer dollars rather than defaulting to pre-tax treatment.
Advisors should also review catch-up contribution rules carefully. Beginning in 2026, employees earning more than $150,000 from 2025 must make all catch-up contributions as Roth dollars, which can materially change tax outcomes if not planned for in advance.
Many employers now offer emergency savings accounts linked to retirement plans and matching contributions tied to student loan payments. When coordinated properly, these benefits can improve short-term liquidity without sacrificing long-term savings or tax efficiency.
Pro tip: Maintain a standardized benefits checklist for every client and review it annually. Use it to confirm contribution types (pre-tax, Roth, after-tax), catch-up eligibility under the $150,000 rule, employer match treatment, and any new plan features added midyear.
4. Optimize retirement contributions and Roth strategy
SECURE Act 2.0 expanded contribution limits and flexibility, making retirement plan optimization a core planning priority for working families. For 2026, the projected 401(k) employee contribution limit is $24,500 for those under age 50, with an $8,000 catch-up for those 50 and older and a total employee-plus-employer limit of $72,000.
Beginning in 2026, employees earning more than $150,000 in 2025 must make catch-up contributions as Roth dollars, increasing the importance of coordinating Roth versus traditional savings decisions.
Advisors should also prioritize the enhanced catch-up window for clients ages 60 through 63, which allows up to $11,250 per person in additional catch-up contributions for a limited four-year period. For a married couple in this age range, this can translate into more than $60,000 per year in combined 401(k) contributions when base limits and catch-ups are fully utilized.
Beyond annual contributions, Roth strategy plays a role in longer-term income planning. Partial Roth conversions can reduce future required distributions, smooth taxable income, and increase tax-free flexibility. However, conversions increase current-year income and may temporarily eliminate deductions, ACA subsidies, or other OBBBA-related benefits. Advisors should model these tradeoffs carefully and view conversions as a multi-year strategy rather than a one-time event.
Pro tip: Retirement planning is not just about how much clients save in one year, but how and when those dollars are taxed. Coordinate contribution choices, catch-up rules, and Roth conversions as part of a multi-year income plan, not in isolation.
5. Leverage family-focused benefits
OBBBA significantly expands planning opportunities for families with children, making coordination essential rather than optional. The Child Tax Credit increases to $2,200, becomes permanent with inflation adjustments, and continues to phase out at $200,000 for single filers and $400,000 for married filing jointly.
Of the $2,200 Child Tax Credit, up to $1,700 per child is refundable, allowing eligible families to receive a benefit even if their federal income tax liability is limited. Because refundability and phaseouts are income-sensitive, timing bonuses, capital gains, and Roth conversions can directly affect whether families receive the full credit.
Advisors should also revisit Section 529 education planning, particularly given expanded federal flexibility beginning in 2026. Annual K–12 withdrawals double to $20,000, and qualified expenses now include tutoring, online courses, standardized testing, dual enrollment, disability support, and approved workforce training programs. These changes increase the usefulness of 529 plans beyond traditional college funding, but they also introduce state-level complexity.
While federal rules govern tax-free treatment at the national level, state conformity varies. Some states automatically adopt federal definitions of qualified 529 expenses, while others require legislative updates or maintain narrower rules. In non-conforming states, families may owe state income tax or face recapture of prior state deductions if funds are used for expenses the state does not recognize as qualified. Advisors should confirm state treatment before recommending larger or more frequent distributions.
Pro tip: Beginning in 2026, student-loan flexibility narrows materially. Graduate borrowing is capped at $100,000 and professional degrees at $200,000, while most income-driven repayment and forgiveness options disappear for new borrowers. For families with the means, this shifts education planning away from debt optimization and toward higher upfront 529 funding to reduce long-term repayment risk.
6. Leverage new OBBBA income-reduction opportunities
OBBBA introduces several temporary income-reduction provisions that may benefit working families, but only when applied carefully. Advisors should evaluate these opportunities individually rather than assuming broad applicability.
New deductions for tip income and overtime pay can provide meaningful relief for moderate earners through 2028. The tip income deduction allows up to $25,000 annually, while the overtime deduction is capped at $12,500 for single filers and $25,000 for joint filers. Both deductions phase out above $150,000 of income for individuals and $300,000 for married couples, limiting their usefulness for higher earners.
OBBBA also created a new deduction for vehicle purchases made between 2025 and 2028. Individuals may deduct up to $10,000 of annual auto loan interest, with phaseouts beginning above $100,000 of MAGI for single filers and $200,000 for married filing jointly. Eligible loans must be for new, personal-use vehicles assembled in the United States, with original use beginning with the taxpayer and loans originating after December 31, 2024. Leases do not qualify.
The expanded SALT deduction cap adds further complexity. While the cap increases to $40,000 per household, the benefit phases out between $500,000 and $600,000 of income for single and joint filers and remains temporary, reverting to $10,000 in 2030 unless extended. Advisors should determine whether itemizing makes sense and model how incremental income could eliminate the benefit entirely, particularly for families in high-tax states.
Pro tip: The value of OBBBA deductions depends on timing and eligibility. Model how each deduction interacts with income thresholds, ACA credits, and other phaseouts before making recommendations.
Working families do not need more financial products. They need coordination.
Advisors who deliver an annual planning framework that integrates taxes, benefits, retirement, family goals, and long-term strategy move beyond transactional advice. This approach scales across younger professionals, dual-income households, and mid-career families while clearly demonstrating ongoing value.