2013 marks a watershed year for contribution limit increases in many of the core retirement savings programs. Many of these contribution limit increases are established using a federal formula. While most annual limits stayed the same from 2011 to 2012, this is not the case for 2013. Here are current annual contribution limits for the more popular programs:
Retirement
Program | Current Year
2013 | Last Year
2012 | Change | Age 50 or over
to catch up |
| IRA: Traditional |
$5,500 |
$5,000 |
+$500 |
add: $1,000 |
| IRA: Roth |
$5,500 |
$5,000 |
+$500 |
add: $1,000 |
| IRA: Simple |
$12,000 |
$11,500 |
+$500 |
add: $2,500 |
| 401(k), 403(b), 457 plans |
$17,500 |
$17,000 |
+$500 |
add: $5,500 |
|
Take action
If you have not already done so, please consider:
- reviewing and adjusting your periodic contributions to your retirement savings accounts to take advantage of the higher limits
- setting up new accounts for a spouse or dependent
- using this change as a chance to review the status of your retirement plan
- reviewing contributions to other tax-advantaged plans like Flexible Spending Accounts (health care and dependent care) and pre-paid medical savings plans like HSAs (Health Savings Accounts)