Last year we maxed out contributions to my 401(k).
We’ve been able to max out the 401(k) in the past, and when we do it always seems like a pretty good barometer of how good our year is going.
If we are able to max it out, it means we didn’t have a ton of other expenses to worry about (like hospital bills).
In 2021 we plan on once again investing as much as we can in the company-sponsored 401(k), before investing in taxable investments.
So what do the contribution limits for retirement accounts look like in 2021?
The Roth IRA has remained mostly unchanged for 2021, with the IRA contribution limit staying at $6,000, and catch-up contributions at $1,000.
The 401(k) is a similar story. It hasn’t changed either.
Today I thought I would take an in-depth look at what the 401k contribution limits, rules, and regulations will be for 2021 since we plan on maxing it out again this year.
The IRS released their 401k contribution guidelines this past week, and the max contribution has remained the same for 2021. That means you’ll be able to contribute $19,500, the same as you did for 2020.
The limit on contributions by employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan remains unchanged at $19,500.