Under the new law, employees will be able to contribute even more into their retirement plan, taking advantage of  tax deferral and compounding growth on their investments.
	Present law allows employees to contribute 15% or $10,500 (whichever is lower) to a 401(k) or 403 (b) plans. The new limits starts at $11,000 in 2002 and goes up $1,000 per year to $15,000 in 2006.  The new provisions align 457 Plans with the higher limits and enjoy a large increase form the current $8,500 cap.  Limits after  2006 are adjusted for inflation in $500 increments.
	Catch-up contributions for participants age 50 and above start at $1,000 in 2002 and go up to $5,000 in 2006 where they will also be indexed for inflation.
	401(k) plans remain a very attractive savings vehicle for retirement for many reasons;
	•   Matching contributions by employers result in potentially greater build up in    savings.
	•   Participants in a 401(k) may be able to take tax-free loans.
	•   The payroll deduction feature in a 401(k) makes the savings relatively painless    for most employees.