New Rules Prompt More Saving

March 4, 2002 ( - Seven out of ten Americans plan to save more in their employer-sponsored retirement plans this year, a new survey finds.

According to the survey by Fidelity Investments, investors are ready to plough a hefty $39 billion into Individual Retirement Accounts (IRA) this year – up $8 billion over 2001 because of newly liberalized IRA contribution rules.

Half of those aged 50 or over, intend to meet the maximum IRA contribution limit of $3,500 for 2002. Members of this group are also likely to put in the additional $1,000 in workplace programs that was allowed in recent law changes.

Investors under the age of 50 can now put in $3,000 annually. Of this group, 82% are likely increase their 2002 contributions.

According to Fidelity’s survey, the majority of those who intend to contribute more expect additional savings to come from a salary increase or second income, a decrease in living expenses, or shifting general savings into a retirement account.