Retirement Contribution Limits for 2024: What You Need to Know
The Internal Revenue Service (IRS) has released the retirement contribution limits for 2024. These limits are the maximum amount of money that you can contribute to your retirement accounts each year.
Don't Feel Bad if You Can't Max Out Your Retirement Accounts!
It's important to remember that you don't have to max out your retirement accounts. The most important thing is to save to meet your specific goals. Everybody has different goals that need a different level of investing amounts. Even if you can only save a small amount each year, it can add up over time.
401(k), 403(b), and 457 Plans:
The 401(k) contribution limit for 2024 is $23,000 (or $30,500 if you are age 50 or older) The 403(b) and 457 plan contribution limits are also $23,000 for 2024, with the same catch-up contribution limit of $30,500 for people age 50 or older.
Solo 401(k)s
The solo 401(k) contribution limit for 2024 is $69,000, or $76,500 if you are age 50 or older. Solo 401(k)s are a good option for self-employed people and business owners who want to save for retirement.
SEP IRAs
The SEP IRA contribution limit for 2024 is $69,000. SEP IRAs are a good option for small businesses that want to offer a retirement plan to their employees.
SIMPLE IRAs
The SIMPLE IRA contribution limit for 2024 is $16,000. SIMPLE IRAs are another good option for small businesses that want to offer a retirement plan to their employees.
IRAs
The traditional IRA contribution limit for 2024 is $7,000, or $8,000 if you are age 50 or older. T
The Roth IRA contribution limit is also $7,000 for 2024, or $8,000 if you are age 50 or older.
Income Phase-Out for Roth IRAs
If your income is above a certain level, you may not be eligible to contribute to a Roth IRA. The income phase-out ranges for Roth IRAs in 2024 are as follows:
Single filers: $146,000-$161,000
Married couples filing jointly: $230,000-$240,000
Social Security Wage Base
The Social Security wage base for 2024 is $168,000. This means that you will only need to pay Social Security taxes on your earnings up to $168,000 in 2024.
Health Savings Accounts (HSAs)
The HSA contribution limit for 2024 is $4,150 for individuals and $8,300 for families. HSAs are a good way to save for medical expenses, and they offer a number of tax advantages.
Here are some tips for saving for retirement:
Start saving early. The earlier you start saving, the more time your money has to grow.
Set realistic goals. Don't try to save too much money at once, or you're more likely to give up.
Automate your savings. Set up a recurring transfer from your checking account to your retirement account each month.
Increase your savings rate as your income increases.
Rebalance your portfolio regularly. As you get closer to retirement, you may want to shift your portfolio to more conservative investments.