Senate panel votes higher 401(k) limit.

Investment News, September, 2000

* The Senate Finance Committee unanimously approved last week legislation that would increase allowable annual contributions to $15,000, from $10,500, for 401(k) accounts and to $5,000, from $2,000, for individual retirement accounts. The measure would also allow people over 50 to put $7,500 into IRAs and make catch-up contributions into 401(k)s.

It would create "Roth" 401(k)s, which would allow workers to put after-tax money in their plans and withdraw principal and earnings tax-free on retirement. The bill would also make it easier to transfer funds between different types of retirement plans. The cost of the plan is estimated at $42.3 billion over the next decade. The House passed a similar bill in July.