What is the 401(k) contribution limit?
For the current year, the employee elective deferral limit is $23,000. If you are age 50 or older, you can add a $7,500 catch-up contribution for a total of $30,500. Employer matching contributions are on top of these employee limits, subject to a higher overall cap.
What is the IRA contribution limit?
The IRA contribution limit is $7,000 for the current year, with an additional $1,000 catch-up for those age 50 and older, for a total of $8,000. This limit is shared across traditional and Roth IRAs combined.
Can I contribute to both a 401(k) and an IRA?
Yes. The 401(k) and IRA limits are separate, so you can contribute to both in the same year. However, your ability to deduct traditional IRA contributions or contribute to a Roth IRA may be reduced or phased out at higher income levels if you are also covered by a workplace plan.
What are catch-up contributions?
Catch-up contributions let savers age 50 and older contribute above the standard limits: an extra $7,500 to a 401(k) and an extra $1,000 to an IRA. They are designed to help those closer to retirement accelerate their savings.