Embrace the New Limits: Maximizing Your Retirement Contributions in 2024

With each new year comes an opportunity to recalibrate our financial strategies, and 2024 is no exception. We’re bringing to light the updated limits that may affect your retirement planning. It’s important to understand these limits as they can significantly impact your journey to financial freedom. 

Below is a comprehensive chart that encapsulates the updated limits across various categories. 

Key Takeaways

Here are the most notable changes that may affect your planning:

401(k), 403(b), and 457 Plans: The elective deferral limit has been increased by $500 to $23,000. This adjustment allows individuals to defer more of their income to company sponsored retirement plans, whether pre-tax or Roth.

IRA Contributions: The limit on annual contributions to your IRA has been raised by $500 to $7,000 for 2024. This is a key change for those using IRAs as a cornerstone of their retirement strategy.

Catch-Up Contributions: For individuals ages 50 and older, there were no changes to the catch-up contribution limits this year.

HSA Contributions: Health Savings Account contribution limits increased to $4,150 for self-only and $8,300 for family coverage. This can help offset growing healthcare costs, whether the funds are used now or in the future. 

For Those with Higher Incomes: 

• Those earning $155,000 (previously $150,000) or more are considered highly compensated. This can affect participants in non-safe harbor company sponsored plans.
• Wages up to $168,600 (previously $160,200) are taxed for Social Security.
• Wages up to $345,000 (previously $330,000) are eligible for company matching.

In order to maximize your retirement savings, it’s important to know these limits, as they may or may not change each calendar year. 

Our Role in Your Financial Planning

We’re here to help you analyze these changes and integrate them into your financial plan.

For a detailed look at the updated limits or to discuss how these changes can be incorporated into your financial strategy, reach out to us.