The House and Senate are looking at bills whose purpose is to change the attitudes companies have towards funding retirement for their employees. There is a fair amount of negotiating to do, but it’s likely something will be decided before the tax deadline on April 15.
Here are some of the provisions from the bills, as listed by CNN:
* Ensure pensions are adequately funded. In a world where we require investigations into pension management, in this case relating to United Airlines, this is sure to be a hot topic.
* Making pensions more transparent. Perhaps annual reports are necessary.
* Boosting 401(k) participation. Automatic enrollment looks like a shoe-in for the new law once it is finalized. I can only imagine how happy this will make fund managers.
* Boosting 401(k) contributions. The government will provide incentives to companies for making employee-friendly changes to matching contributions, vesting schedules, portability, and access to investment advice.
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Hmmmm…I don’t know about the automatic 401(k) enrollment for the employees. Why are they pushing for it? Yes, it does get more people saving, but I’d rather have more control over my money than less. What’s down the road? A 50% tax on 401(k) distributions? If my retirement money is in a 401(k) and I need it to live off of, what choice would I have but to give them half? It’s a tax-advantaged account now, but the flip side is that it’s not a tax-advantaged account later. Call me a cynic, but I suspect that Uncle Sam’s debt will start to come due and they’ll expect me to pay for it.
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