If you are preparing for retirement and using your 401(k) as the primary savings vehicle; you will be happy to know that you can now add more money to your account in the coming year. According to the IRS.gov website; in 2020, you can contribute $19,500 to your 401(k) account.  This is an increase of $500 from last year’s limit.

This limit also applies to federal employees utilizing the Thrift Savings Plan.

Here are a few other notable changes:

1-Catch-up contributions for those over the age of 50 has increased from $6000 to $6500.

2-SIMPLE Retirement accounts will also increase from $13,000 to $13,500.

One Annual Contribution Remains The Same

For those of you that contribute to an IRA, the yearly contribution of $6k will be the same in the upcoming year. This also includes the catch-up rate for those 50 and older.

Take advantage of these changes to the 401(k) contribution limits to ensure you’re getting the most out of your retirement savings.