House Considers Changes to Workplace Retirement Plans
A conversation every young saver should pay attention to began last Tuesday when an initial House Ways and Means hearing took place to discuss “tax-favored retirement accounts” and their place in tax reform.
While Chairman David Camp’s opening statements did not include references to revenue raising (or the ridiculous idea that deferred income equates to a “tax expenditure”), advisors and others have become afraid that this conversation may be leading to lesser opportunities for individuals to save on a tax-favored basis in the future.
And though Representative Camp’s opening comments don’t speak to those issues, be sure that they are a prime driver in the discussion. He instead speaks towards the complexity and confusion that exists in the current system. “The proliferation of tax-favored retirement accounts has occurred as specific needs have led Congress to create new types of plans with different rules. Some, however, have questioned whether the large number of plans with different rules and eligibility criteria leads to confusion, reducing the effectiveness of the incentives in increasing retirement savings.” Hopefully the issue of simplicity and equality in retirement savings rule rather than reducing opportunities for young workers, and new ways to pass on our current budgetary issues to the next generation.
If you are so inclined to offer your congressperson a simple way to increase your access to quality retirement planning investments and advice, consider forwarding my plan I’ve described for Forbes readers in the past.
It’s simple – set-up your account with the provider of your choice, direct deposit the funds, the same contribution limits across the board (why do we pay accountants to tell the wealthy business owners they need to cut their contributions by $100?), and have access to your investment dollars on a penalty-free basis to pay for not only investment management services, but also personal financial planning that is the basis for that investment plan.
As the conversation unfolds we all should make sure that individuals and their goals be represented. I encourage every saver to pay attention to what unfolds.
The preceding blog was originally published by Forbes. To view the original blog please visit our blog at Forbes. http://www.forbes.com/sites/feeonlyplanner/