groups have joined the chorus of retirement professionals upset with President
Barack Obama's proposed retirement cap.
to the plan emerged almost immediately. The proposed $3 million cap on
retirement savings could force small businesses to stop offering workplace
retirement plans, the American Society of Pension Professionals & Actuaries
said shortly after the president's plan was unveiled earlier this month.
criticism hasn't stopped.
it won’t hurt every small business, but there are a significant number it will
hurt,” said Judy Miller, director of retirement policy at ASPPA.
budget blueprint, President Obama proposed a $3.4 million cap on how much money
individuals can put into retirement accounts. The move would raise about $9
billion for the federal government over the next 10 years. The cap would
prohibit taxpayers from taking advantage of the pre-tax deferral into their
401(k) or defined contribution pension plans after they cross that $3 million
threshold, which is enough to fund a $205,000 annual annuity for a person
wanting to retire at age 62.
data from the Employee Benefit Research Institute, a very small percentage of
IRA and 401(k) investors would be affected by the cap. In 2011, only 0.06
percent of total IRA account holders had $3 million and only 0.0041 percent of
401(k) accounts had that much money in them at the end of 2012.
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