As every year, allowable retirement contributions have been increased for 2025. Specifically these are the increased maximum contributions:
401(k), 403(b), and Governmental 457 Plans
Individual Retirement Accounts (IRAs)
The above standards seem simple enough and are more or less in line with prior year increases and amounts. But because retirement plan qualifications, limitations, lingo, etc isn’t confusing or perplexing enough, The Secure 2.0 Act added in some head scratching additional confusion. Maybe Congress was just trying to keep tax advisors and financial planners on their collective toes.
What’s quirky this year is that there is a further catch-up contribution category for taxpayers aged 60-63 allowing a total 401(k), 403(b) and 457 plans that would increase the allowable contributions for employees in that category to $34,750. Why 60-63 and not 60+ or any other randomly chosen age range? I have no idea.
If you have any questions about your work sponsored retirement plan or any other financial planning concerns, please don’t hesitate to reach out to us.
