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Across My Desk: The Pensions Protection Act

Mutual fund companies are licking their chops at the prospects of the new Pensions Protection Act---and so ought you.

While the changes will mean big bucks to investment companies, it also means you'll be able to save more for your future and that's a very necessary and as Martha would say "good thing."

Below is an analysis of the Act from the ICI's point of view:

"The reforms would significantly strengthen the retirement security and education preparedness of millions of workers and families by:

  • Making permanent the higher contribution limits to both 401(k)s and IRAs;

  • Allowing automatic enrollment in 401(k)s. The provision would increase worker participation in 401(k) plans, especially among lower-income workers, and facilitate default investment options more appropriate for long-term savings (for example, a balanced equity and bond fund, rather than a money market fund);

  • Increasing the range of providers of investment advice to 401(k) and IRA savers, and

  • Making permanent the tax incentives for Section 529 college savings programs."

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