For Mark Roberts’ Use: As financial advisors, we frequently advise those planning for retirement to save all that you can. And now, we have some good news: Contribution limits for qualified retirement plans were increased for 2019, allowing you to set aside a bit more money for retirement.
If you participate in a 401(k), 403(b), Thrift Savings Plan (for government employees), or most forms of 457 plans, you can now contribute $19,000 to your retirement fund next year. That’s an increase of 500 dollars from 2018.
Remember, these contributions can be made on a pre-tax basis. So in addition to saving for your future, you will be effectively lowering your taxable income for the year. Every little bit of savings helps!
For those aged 50 and older, the catch-up contribution will remain the same. If you want to save additional funds for retirement, you can stash another $6,000 in your 401(k) or other retirement fund as listed above. Over the course of a decade or so, that extra savings can make a significant difference in your ability to retire on schedule.
For those who utilize an IRA to prepare for retirement, your contribution limit for 2019 is $6,000. The catch-up contribution remains $1,000 per year. Remember, contributions to a Traditional IRA are made on a pre-tax basis, with the withdrawals taxed in retirement. However, if you decide upon a Roth IRA, you can make after-tax contributions now and enjoy tax-free withdrawals once you retire.
For more information on retirement fund contributions, give us a call to schedule an appointment. In person, we can offer additional guidance more specific to your situation, and help you plan for a retirement that meets your values and priorities.