Mapping Your Financial Future with New 2024 Retirement Plan Contribution Limits

As we enter 2024, the new year brings revised contribution limits for retirement plans. Understanding these limits and maxing out contributions is fundamental to ensuring a secure financial future.

For 401(k), 403(b), 457 plans, and Thrift Savings Plans, the 2024 contribution limit has been set at $23,000. This allows individuals to allocate a substantial portion of their income towards retirement savings, capitalizing on the power of compound growth over time. What’s even more encouraging is the catch-up contribution provision for individuals aged 50 and over, allowing an additional $7,500 contribution for a total of $30,500 in 2024. This catch-up contribution is a strategic tool for those looking to accelerate their retirement savings in the final stretch before retirement.

For Individual Retirement Accounts (IRAs), the 2024 contribution limit is $7,000, providing another avenue for individuals to bolster their retirement nest egg. Moreover, for those aged 50 and over, the catch-up contribution allows an additional $1,000, bringing the total contribution limit to $8,000. This additional contribution recognizes the need for enhanced savings as retirement draws near.

Saving for retirement isn’t just a financial responsibility; it’s an investment in your future well-being. Beyond the peace of mind that comes with knowing you’ve diligently prepared for your golden years, there are significant tax benefits associated with retirement contributions. Contributions to traditional retirement accounts, such as 401(k) and traditional IRAs, may be tax-deductible, providing an immediate reduction in taxable income. Additionally, these accounts grow tax-deferred, allowing you to compound your savings more efficiently.

The 2024 retirement plan contribution limits underscore the importance of strategic financial planning, especially as individuals approach retirement age. Taking advantage of these increased limits and catch-up contributions can make a significant difference in the long-term financial security of individuals and families. For more information on saving for retirement, and to learn strategies related to maxing out your retirement plan contributions, call our office to schedule a personal consultation.

About the Author: Mark Roberts

In addition to managing clients’ money and giving investment and diversification advice, Mark offers something that “the other guys” don’t - a unique approach to Retirement Tax Strategies and distribution. Time and time again, Mark meets with new clients who tell him they have a great relationship with their financial advisor but have never been offered information on this kind of approach to securing their financial futures. Mark has taken this feedback to heart and works tirelessly to ensure that his strategies focus on taxes and distribution. Mark started selling insurance for a major insurance company right out of high school to help put himself through college. After graduating with a degree in finance, he dove into estate planning on the financial side to set himself apart from other financial advisors. However, as changes were made to estate tax laws over time, Mark shifted his focus to income tax strategies. Mark’s philosophy is “the blue prints are more important than the wall paper or carpet.” The wall paper and carpet represent products like investments and insurance policies, whereas the blue prints represent the strategies. Once strategies that truly fit the client’s needs are put in place, our focus can shift to providing you with the right products. According to Mark, “It doesn’t matter what carpet we use if the walls are not in the right place.” Our approach to money management is designed to generate the largest alpha (quality) with the lowest standard deviation and beta (risk). By doing this, we help provide clients with the highest return on the lowest risk. Generating income for our retirees is also very important. Because withdrawing money from your portfolio hurts the account rather than helping it, our goal is to design income strategies to harm the portfolio the least making the money last longer.

Mapping Your Financial Future with New 2024 Retirement Plan Contribution Limits

Mapping Your Financial Future with New 2024 Retirement Plan Contribution Limits

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About the Author: Mark Roberts