"President Barack Obama's proposal to cap tax-deferred retirement contributions at $3.4 million is raising a lot of questions among financial planners," Kelly Greene understatedly wrote on The Wall Street Journal's Total Return blog on Monday.
Full-fledged freak-out is more accurate.
"Curbing the growth of retirement plans in a nation where 91% have less than $100k saved is insanely ignorant," financial planner, author and speaker Rick Kahler tweeted upon news of the plan, summing the sentiment of many in the advisor industry.
Criticism of the overall budget was bipartisan, with Joe Lieber of Washington Analysis noting that "liberals are especially concerned about the president's inclusion of chained CPI," a different measure of the consumer price index, "as a cost savings measure."
But as with the Whac-A-Mole carnival game, new regulation often means new opportunity, and Greene pointed to two new funding strategies already making the rounds in social media forums.
The president's budget proposal includes a lifetime cap on savings in individual retirement accounts and other tax-deferred savings vehicles, including 401(k) plans and profit-sharing plans.
"The reasoning is that a worker's total account balance would be limited to the amount needed by a 62-year-old to buy an annuity generating an annual payment of $205,000," she explained.
