2025 Retirement Contribution Limits
2025 retirement savings limits. With the new increased saving limits these changes could significantly influence your financial strategies in the coming months.
Here are the new contribution limits:
- 401(k), 403(b), most 457 plans, and the federal Thrift Savings Plan: The standard contribution limit will increase to $23,500 (up from $23,000 in 2024). For those aged 50 and above, the catch-up contribution remains at $7,500, bringing the total allowable contribution to $31,000.
- New “super catch-up” contribution: Individuals aged 60 to 63 can contribute up to an additional $11,250, raising the total limit to $34,750. Bonus tip: If you’re eligible, consider maximizing contributions now, as the super catch-up ends at age 64.
- Individual Retirement Accounts (IRAs): The contribution limit will remain at $7,000, with an additional $1,000 catch-up contribution for those aged 50 and older.
Understanding your current tax rate and what tax rate you will be in retirement could potentially sway your decision to save in a ROTH 401(k) where you pay the tax today and the earnings grow tax free! If you have any questions about how these adjustments might fit into your retirement strategy this year, please don’t hesitate to reach out. We are here to assist you in any way we can.
Emerald Advisors, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.
