It's bad enough many saw their 401K plans take a dump when the stock market took a dive last year. Now it appears that the annual inflation adjustment coming for 401K plans may actually reduce investment amounts in 2010.

The events of the past year in the financial markets have, hopefully instilled in the minds of lawmakers that the average individual is not qualified to manage their retirement dollars. At its worst, the stock market was down approximately 60% from its high. I don't know what was more shocking, the depth of the fall, or the speed. Individual investors watched as their wealth evaporated and retirement plans were forever changed.

A Dartmouth economist, working with colleagues from Harvard and MIT, has developed projections of future levels of retirement wealth to address what some analysts have called a “perfect storm” of events that threatens the retirement security of future retirees.

The average value of Americans’ 401(k) plans will be substantially higher in real terms by the year 2040 even if stock market returns fall short of their historical values, according to new research by a team of economists from MIT, Harvard and Dartmouth.

Fine print in the new Pension Protection Act passed last year is now coming to light. Much of what we heard is laced with new requirements, and many workers are going to get caught in a web of confusion if they relay on the basic new rules outlined by the press.