As we enter 2025, now is the perfect time to revisit your retirement savings strategy. 2025 Retirement Plan Contribution Limits have been updated. With updated contribution limits and new opportunities introduced by recent inflation adjustments, this year offers several ways to optimize your savings and secure a more comfortable retirement.
Whether your goal is to lower your taxable income for this year or to boost your retirement nest egg, understanding these new limits is crucial.
2025 Retirement Plan Contribution Highlights (click here for video summary)
- Increased IRA Contribution Limits:
- For 2025, individuals can contribute up to $7,000 to their IRA, with an additional $1,000 catch-up contribution if you’re 50 or older. Contributions for 2024 can still be made up until April 15, 2025, so you have time to maximize last year’s limits as well.
- Enhanced Catch-Up Contributions for 401(k)s and 403(b)s:
- If you’re aged 60-63 by year-end, you’re eligible for a new, higher catch-up limit of $11,250—a significant increase from the standard $7,500 catch-up for those 50 and older. This change, part of SECURE 2.0, allows you to supercharge your retirement savings during key pre-retirement years.
- SEP and SIMPLE IRAs:
- For SEP IRAs, the maximum annual contribution for 2025 is 25% of up to $350,000 in compensation, capped at $70,000. Contributions can be made until the tax filing deadline, including extensions. SIMPLE IRAs also see enhanced employee salary deferral limits, making them a valuable tool for small business owners and employees alike.
- Qualifying Longevity Annuity Contracts (QLACs):
- You can now purchase a QLAC with up to $210,000 of your retirement funds. QLAC dollars are excluded from Required Minimum Distribution (RMD) calculations until age 85. This gives you greater control over your retirement income.
- Updated Phase-Out Ranges for Roth IRAs:
- For 2025, Roth IRA contribution eligibility begins to phase out for joint filers earning $236,000-$246,000 and single filers earning $150,000-$165,000.
- Don’t Forget Beneficiaries:
- Updating your beneficiary forms is a critical part of managing your retirement accounts. Life events like marriage, divorce, or the birth of a child may necessitate changes to protect your legacy.
To make the most of these updates, we’ve created an easy-to-use guide, “2025 Retirement Plan Contribution Limits.” This resource provides all the details you need to ensure your contributions align with your financial goals and current regulations.
Financial Success Doesn’t Happen by Chance.
Contact lead advisor Chris Robinson, at 940-464-4104, to schedule a time to discuss your beneficiary or investment questions. Additionally, you may also schedule a virtual consultation online at https://rfgwealthadvisory.com/virtualconsultation/.
RFG Wealth Advisory in Argyle, Texas, is an independent, fee-only Registered Investment Advisor firm that always puts our client’s interests first. We have a transparent, simple fee structure that’s easy to understand. Call us today!
Investment advice is offered through RFG Wealth Advisory, a Registered Investment Advisor.
2025 Retirement Plan Contribution Limits
Disclaimer
Financial Success Doesn’t Happen by Chance.
Contact lead advisor Chris Robinson with RFG Wealth Advisory in Argyle, Texas to discuss your questions.
RFG Wealth Advisory is an independent, fee-only Registered Investment Advisor firm in Argyle, Texas. At RFG Wealth, our fiduciary duty ensures your interests always come first, and we maintain a transparent fee structure for your peace of mind. Contact us today!
Investment advice is offered through RFG Wealth Advisory, a Registered Investment Advisor.
Schedule a Virtual Consultation
Chris Robinson is the president of RFG Wealth Advisory, which he founded in 1995. He is a current resident of Argyle and native of Denton, Texas.
