Yesterday, the IRS announced increased limits for retirement plan contributions for 2023 for both employer-sponsored plans and individual retirement accounts.
Employer Sponsored Plans (401k/403b/TSP/457)
The maximum increased from $20,500 for 2022 to $22,500 for 2023. For those age 50 and over, the additional “catch-up contribution” went from $6,500 to $7,500.
Therefore, maximum contributions for those under age 50 is $22,500 while those age 50 and up can contribute up to $30,000.
Individual Retirement Accounts (IRAs)
For Traditional or Roth IRAS, the maximum contribution went from is $6,000 to $6,500 for 2023. For those age 50 and up, the “catch up” contribution remains at $1000.
Total contributions are maxed at $6500 for those under age 50 or $7500 for those age 50 and up. These come to $541.66 per month and $625 per month, respectively, if you are making monthly contributions.
If you have already established payroll deductions to your 401k, TSP, or 403b, or automatic bank draft contributions to your Traditional or Roth IRAs, you can increase those contributions starting in January.
Please contact your financial advisor with any questions.
