New 401(k) Contribution Limits for 2015
Yesterday, the IRS published new contribution limits for participants in 401(k) plans for 2015. Effective next year, the maximum contribution amount will increase to $18,000 from $17,500 in 2014. For participants over 50, the catch up contribution limit will also increase in 2015 by $500 to $6000. For those investors that save for retirement through individual retirement accounts (IRAs), the maximum contribution limit and catch up contribution limit will remain the same as 2014 at $5,500 and $1,000, respectively.
Unfortunately, many participants do not take full advantage of the amount that they may contribute to their 401(k) plans and/or IRAs and therefore miss out on significant tax savings for their retirement nest egg. At RDM Capital, we work with investors to develop tax efficient investment strategies that include contributing the maximum possible deferral to retirement plans within the constraints of the investor's overall financial plan. Due to the benefits of tax deferral over time, we believe it is very important for investors to begin saving for retirement early and utilize retirement plans to the fullest extent possible.
Follow the link below for more information about the IRS rule changes for 2015: