MAX "MUM"

Only 11% of those under 50 contribute the $12,000 maximum tax deferred amount, and just 14% of those over 50 contribute the $14,000 maximum tax deferred amount, according to the Putnam Participant Poll. Worse, a whopping 58% did not even defer half of the permitted amount, according to the report. While most 401(k) investors don't make changes to their investments, when they do, it is largely due to investment underperformance. Putnam also notes that 28% of participants change funds when investment options are added. More on the survey HERE.

HOUSE "CALL" 

The House of Representatives has approved the Pension Security Act by a 271-157 vote. The bill would lower legal barriers that bar investment firms from offering participants financial advice for a fee, as well as adding some new protections, including the ability to diversify company stock investments (after a period). Opponents were scathing in their response to the measure, including Representative Rob Andrews (D-New Jersey) who said, "If you liked the Enron scandal, if you liked the WorldCom scandal, you'll love what will happen to pensions if this bill becomes law." The proposal passed the House in a nearly identical fashion a year ago - but as now, faced a less certain fate in the Senate. MORE

"TOUCH" POINTS

 Just a few short years ago, it was accepted "wisdom" that a high-touch, high-cost personally delivered advice service didn't have much of a future in the retirement plan market. Sponsors balked at the idea of funding what seemed like an expensive way to help workers manage their retirement accounts prudently, and workers weren't showing much willingness to foot the bill, either. But there's nothing like a "cold" market and some new offerings to provide a fresh perspective. MORE

PENSION POUR  (PLANSPONSOR.COM)

American businesses poured nearly three times as much money into their beleaguered pension funds last year as in 2001 - some $46 billion, according to a new study from Credit Suisse First Boston. The report said that S&P 500 firms overall used about 6% of their total cash flow from operations to shore up the plans, according to Dow Jones. MORE

FULL PULL?  (PLANSPONSOR.COM)

The percentage of employers with fully funded pension plans declined from 84% in 1998 to just 37% last year, according to a new Watson Wyatt study. The consulting firm said the drop would have been even greater had Congress not passed the Job Creation and Worker Assistance Act of 2002, which increased the maximum interest rate companies can use to determine the present value of benefits earned to date under the plan - and cautioned that Treasury still needs to take permanent action on replacement of the 30-year Treasury bond rate. MORE