Pols Give Funds a Boost

The new legislation also made permanent the $4,000 annual contribution limits to Roth or traditional individual retirement accounts, which were set to be rolled back to $2,000 a year in 2010. (Investors over the age of 50 can contribute up to $5,000 a year.)

The law also preserves higher contribution limits and catch-up contributions that allow investors over 50 to save as much as $20,000 a year in a 401(k) plan.

The new money these savings programs will bring in could be key to growth in mutual fund assets, which has largely been driven by stock market gains over the past few years. The average U.S. stock fund tracked by Morningstar returned an annualized 11.31% over the past three years, while the annualized return of the average international stock fund was twice as high at 24.15%

The mutual fund industry reached an important milestone in 2006 when it passed the $10 trillion mark, but $566 billion of the industry's $4 trillion in growth for the year to date (through October) since 2002 has come from new money, according to data from the ICI.

Another regulatory development that could benefit existing mutual fund investors and increase the attraction of these investment vehicles to new investors is on the corporate governance front. The Securities and Exchange Commission recently said it was taking another look at the costs and benefits of requiring 75% of fund boards to be independent directors and requiring the chairman to be independent.