OBBB Planning: Where to Start in 2026 | Encompass Financial Planning
Behind on OBBB Planning? Here’s Where to Start in 2026
If 2025 came and went without major changes to your financial plan, you’re not alone and you’re not behind.
While the One Big Beautiful Bill (OBBB) did not overhaul the entire financial landscape, it did significantly adjust several planning levers that can affect retirement income and taxes, including:
- Adjustments to tax brackets and thresholds
- Updated contribution limits for retirement accounts
- Changes that affect withdrawal timing and Roth strategies
- Planning considerations that now overlap more closely with estate and beneficiary decisions
None of these changes require drastic action, but taking full advantage of their potential benefits does require coordination, and that coordination is where many people simply have not had the chance to pause and recalibrate.
At Encompass Financial Planning, we help clients understand what’s changed under the new law, what remained the same, and how those updates fit into a broader wealth strategy. And with a new year underway, this is a strong moment to ensure your strategy reflects today’s rules and your current priorities with intention and clarity.
Here are five ways to get your plan on the right track.
1. Update Withholding and Estimated Tax Payments for 2026
Tax law changes do not automatically adjust your paycheck, pension income, or retirement distributions. If your withholding remained unchanged in 2025, your tax outcome may no longer reflect your planning goals. That can lead to unexpected tax bills or missed opportunities to improve cash flow.
Action steps:
- Review your most recent tax return for underpayment or large refunds
- Confirm withholding on pensions, Social Security, and IRA distributions
- Adjust withholding or quarterly estimates early in the year
Small updates made early can reduce stress and improve predictability later.
2. Make Sure You’re Using New Retirement Contribution Limits
OBBB increased contribution limits across several retirement accounts. These updates create opportunities for additional tax efficiency, especially for those in peak earning years or approaching retirement.
Missing a year does not derail your plan. Taking advantage early helps maintain momentum.
Action steps:
- Confirm updated limits for IRAs, employer plans, and catch-up contributions
- Review eligibility for Roth versus pre-tax contributions
- Make contribution decisions intentionally rather than defaulting to prior years
Contribution strategy works best when aligned with both current taxes and future income needs.
3. Review Your Retirement Withdrawal and Roth Strategies
OBBB reinforced the importance of understanding where retirement income comes from and when it is accessed. The sequence of withdrawals can affect taxes, Medicare premiums, and long-term flexibility.
Action steps:
- Re-evaluate income sequencing across taxable, tax-deferred, and Roth accounts
- Assess whether partial Roth conversions still make sense under updated tax brackets
- Review strategy before distributions begin
This area often has a meaningful impact on long-term outcomes.
4. Check Estate Documents and Beneficiaries
Tax changes often affect estate planning decisions. Even when documents are legally up to date, beneficiary designations and legacy intentions may no longer align as cleanly with the rest of your plan.
Action steps:
- Confirm beneficiary designations on all retirement and investment accounts
- Review how current tax rules affect inherited assets
- Coordinate estate planning alongside tax and retirement strategies
Clear alignment here supports both financial confidence and family clarity.
5. Reconnect Your Financial Plan to Your Life Today
Financial plans should reflect current priorities, responsibilities, and goals. Life changes such as caregiving roles, health considerations, or evolving retirement timelines deserve to be reflected in your strategy.
Action steps:
- Review income needs, lifestyle goals, and family considerations
- Assess how health care and longevity planning fit into your strategy
- Ensure financial decisions support your present and future vision
Holistic planning connects financial strategy to real life.
Why January Is the Best Time for Retirement and Tax Planning
The beginning of the year offers flexibility. There is time to adjust withholding, plan contributions, coordinate withdrawals, and make proactive decisions before income and distributions are locked in.
At Encompass Financial Planning, we believe clarity comes from education and connection. Our education-first approach is built on nearly two decades of experience supporting professionals such as nurses, educators, and engineers, as well as women navigating transitions including caregiving, divorce, or widowhood.
If the first year of OBBB felt confusing, that’s understandable. But what matters most now is knowing support and guidance are available, and whenever you’re ready, we’re here to help you move forward with confidence through thoughtful, informed conversations.
Frequently Asked Questions About OBBB Planning
Do I need to make changes if I did not notice an impact in 2025?
Not necessarily. A review can confirm whether your strategy remains aligned under the updated rules.
Did OBBB change retirement income planning?
The core principles remain the same, though coordination between income sources has become more important.
Is Roth planning still relevant after OBBB?
Yes. Roth strategies continue to play an important role when timing and tax context are considered carefully.
Should estate plans be reviewed because of tax changes?
In many cases, yes. Even when documents remain valid, beneficiary alignment should be confirmed.
Is it too late to adjust for 2026?
No. Early-year planning allows for the greatest flexibility.
