Each year the IRS publishes updated 401K contribution limits, as well as catch-up contribution limits for the new year. Typically, the limits the IRS sets each year is based on inflation factors (with minimum $500 increases), so they do not necessarily increase the limit each year.
The 401K Contribution Limit for 2014 has now been set, with no increase over 2013, remaining at $17,500. The 401K contribution Limit for 2013 increased by $500 to $17,500.
READ:
2104 Social Security Inflation Adjustment
Don’t Buy-and-Forget the Investments in Your 401K Plan
IRA Contribution Limits 2014 and Previous Years
Recent History of 401K Contribution Limits:
Find out what's happening in Waterfordwith free, real-time updates from Patch.
As you can see, the 401K contribution limits to not rise dramatically each year. Although over time, if investors are diligent about increasing their contributions, it can certainly make a difference.
2014 – $17,500
2013 – $17,500
2012 – $17,000
2011 – $16,500
2010 – $16,500
2009 – $16,500
2008 – $15,500
Find out what's happening in Waterfordwith free, real-time updates from Patch.
Over Age-50 Catch Up 401K Contribution Limits
For those of you that are over age 50 (or turn age 50 before the end of the year), you are allowed an additional 401K “catch-up” contribution. These limits also adjust for inflation, but at a much slower pace:
2014 – $5,500
2013 – $5,500
2012 – $5,500
2011 – $5,500
2010 – $5,500
2009 – $5,500
2008 – $5,000
Employer Match and Total 401K Contributions
In addition to total allowable employee 401K contributions, there is a maximum total contribution allowed into your 401K (when factoring in employer match). For 2012, the maximum allowed to be contributed into your 401K is $50,000 (or 100% of income, whichever is greater) and will rise to $51,000 in 2013 (with minimum $1,000 increases thereafter).
————————————————————————–
Robert Henderson is the President of Lansdowne Wealth Management, an independent, fee-only advisory firm in Mystic, CT. His firm specializes in financial planning and investment management for retirement, with a special focus on the particular needs of women that are divorced or widowed. He is an Accredited Asset Management Specialist and a Certified Divorce Financial Analyst. Mr. Henderson can be reached at 860-245-5078 or bhenderson@lwmwealth.com. You can also view his personal finance blog,The Retirement Workshop at http://lwmwealth.com/blog and the firm’s website at http://www.lwmwealth.com.
See my Google+ Profile
