I recently received a letter from Fidelity Investments stating that
they will no longer accept new investors as of October 27, 2006 due to
federal legislation.  What is the reasoning behind this and how will
this affect my plan?  Is the future of this plan in jeopardy??

I have no idea what legislation might be cited here, but I'm
curious...Are you talking about a specific Fidelity investment?
Perhaps a specific one of their mutual funds?

From time to time, some mutual funds will close to new investors so as
not to grow too big for what the fund managers want to accomplish. In
those cases, doing so can be seen as a good move for the fund's long
term health.

But your question makes it sound like all of Fidelity Investments is
going to close to new investors for all its products, and that I don't
think is happening.

This first commenter is right on.  It is likely in regard to a
specific mutual fund.

Investments in funds are limited for many reasons.  First, the fund
complex (fidelity) may be trying to launch a similar fund and does not
want to compete with itself.  Second, the strategies of the fund may
be such that if the fund is to big, the strategioes become too
difficult to implement.  Third, there are only so many authorized
shares.