Originally Posted by
george7117
Why do I care? Generally I minimize my personal contributions and try to maximize the company comps (thereby reducing spill). ALPA puts out a spreadsheet to help you decide how much you want to put in based on your preference.
My issue with this LOA, if I understand it correctly, is that it will prematurely cap what the company can contribute earlier than we've seen in the past. I don't get to choose that difference. It will also spill more in the MBCP earlier. A listen to the "leading edge' podcast from a year ago taught me that the early versions of the MBCP will have higher fees until the overall balance matures. I have no intention of participating in high fee investments. Especially when they are marketed as low return (safe). I just want flexibility for my assets. I see this LOA as limiting that.
You don’t understand it correctly. Even if the fees are slightly higher, the tax advantage is still greater than PRAP cash. Long term this is a way better asset to put spill cash into than the RHA (you don’t control and it goes away when you die).
This is not some attempt to benefit the high earners at the expense of the little guy, it’s a way to start the program without running afoul of IRS rules while we wait on the final implementation.