Limited Borrowing Under 401 k Plans.
If a recently introduced bill sees the light of the day, then it would drastically limit the number of loans an employee can withdraw from his/her 401 (k) retirement plans. The two senators responsible for introducing the bill are Senator Herb Kohl, a Wisconsin Democrat & Mike Enzi, a Wyoming Republican. The bill is called The Savings Enhancement by Alleviating Leakage in 401(k) Savings Act of 2011 -or the SEAL Act in short.
76 year old Kohl is the chairperson of the Senate Special Committee on Aging. According to him the 401 (k) bill is aimed at discouraging the employees from eating away in to their retirement assets.
The highlights of the bill are: That it would reduce the number of loans that employees can withdraw at a given time, extend the rollover repayment period post leaving a job, allow 401(k) participants to continue to make elective contributions during the six months after a hardship withdrawal and ban products that promote "leakage," such as the 401(k) debit card.