Retirement Contribution Limits Set to Increase in 2019
<p>As we usher in 2019, there is good news for those who are focused on their future retirement savings. According to the Internal Revenue Service (IRS), the retirement contribution limits will see a rise in 2019, allowing individuals to save more in tax-advantaged retirement accounts. This comes as a welcome announcement for those who are seeking to maximize their retirement savings.</p>
Understanding The 2019 Retirement Contribution Limits
<p>The IRS has announced new contribution limits for employees who participate in 401(k), 403(b), most 457 plans, and the government's Thrift Savings Plan. The limit has been increased from $18,500 in 2018 to $19,000 in 2019. This marks a $500 increase and the first rise of this limit since 2015.</p>
Impact on Individual Retirement Accounts (IRAs)
<p>Furthermore, the limit for contributions to an Individual Retirement Account (IRA), which hadn't seen an increase since 2013, has also been raised. The annual contribution limit for IRAs will be $6,000 in 2019, up from $5,500 in the previous years.</p>
Understanding the ‘Catch-Up’ Contributions
<p>For those who are aged 50 or older by the end of the year, there is an additional provision known as 'catch-up' contributions. These individuals can contribute an extra $1,000 to their IRA and an additional $6,000 to their 401(k) and other similar plans. However, it's important to note that the catch-up contribution limits for 2019 have remained unchanged from 2018.</p>
Maximizing Your Retirement Savings
<p>With the increased contribution limits, here are a few strategies to consider to make the most of your retirement savings:
<ul>
<li><b>Start early:</b> The earlier you start contributing to your retirement savings, the more time your money has to grow.</li>
<li><b>Maximize contributions:</b> If possible, try to contribute the maximum amount to your retirement accounts. This not only allows you to save more but also reduces your taxable income.</li>
<li><b>Consider catch-up contributions:</b> If you're aged 50 or older, don't forget the catch-up contributions. This can significantly boost your retirement savings.</li>
</ul>
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Conclusion
<p>The increase in retirement contribution limits is a positive move for those looking to bolster their retirement savings. It's a golden opportunity to prepare for a secure and comfortable retirement. However, it's essential to remember that every person's circumstances and retirement needs are different. Therefore, it's always a wise decision to seek advice from a financial advisor to create a retirement savings strategy that's tailored to your specific needs.</p>
<p>Remember, planning for retirement is not a one-time activity—it's a continuous process. With the right approach and strategies, you can make the most of these increased contribution limits and set yourself up for a stable and secure financial future.</p>
