Every year, the IRS updates its contribution limits on retirement accounts to adjust for inflation and changes in costs of living. For 2024, those limits are rising. Below are the new 2024 investor contribution limits for 401(k) plans, individual retirement accounts and other retirement accounts:
The IRS has increased the 401(k) plan contribution limits for 2024, allowing employees to defer up to $23,000 into workplace plans, up from $22,500 in 2023. The new amounts also apply to 403(b) plans, most 457 plans and Thrift Savings Plans.
Contributions for individual retirement accounts are now $7,000 for 2024, up from $6,500
The Roth IRA contribution phaseout for married couples filing together will rise to between $230,000 and $240,000 in 2024, up from between $218,000 and $228,000
Catch-up contributions for savers age 50 and older will remain unchanged at $7,500.
The IRS also increased income ranges to qualify for the retirement savings contributions credit and the ability to deduct pretax IRA deposits with a workplace plan.
What does that mean for you and your retirement savings?
Only about 1 in 7 retirement savers manage to max out their 401(k), according to a recent Vanguard study. If you aren’t sure whether you are saving enough for retirement, there are plenty of rules of thumb. Many financial planners recommend saving 10-15% of your salary, but only you can determine what percentage is best based on your situation.
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