401k Contribution Limits Finally Increased For 2012
Starting in 2012 your 401k contribution limits will rise, thanks to inflation. Every year the IRS is required to calculate cost of living adjustments if certain CPI (Consumer Price Index) thresholds are met. The last time this adjustment happened was three ago heading into the 2009 tax year. Since then the CPI has remained low enough to not trigger any cost of living adjustments until now.
Maximum 401k Contribution Limits
If you save for retirement through a 401k the maximum amount you can contribute will be higher in 2012. The new maximum contribution limits will also apply to 403b and most 457 plans.
The maximum contribution limits for 401k retirement plans will be $17,000 for 2012. Slightly higher than the 2011 401k contribution limits of $16,500. This amounts to an additional $500 ($41.67 per month). Which doesn’t seem like much, but every little bit counts when it comes to retirement. This new contribution limit applies to Roth 401k plans as well.
If you’re in the situation of having multiple 401k plans from several employers, this contribution limit change is not on a per plan basis. So if you have two jobs both providing a 401(k), you’ll only be able to contribute a maximum of $17,000 between the two plans. Read more…
Do You Know Who Your Beneficiary Is?
A beneficiary review is one of those yearly events that can be easily overlooked. When you get a life insurance policy or open an IRA, filling out the beneficiary designation is part of the process. It lets you know where that money goes. But, is that name you filled in years ago, still the person you want as a beneficiary? If not, the wrong person will be getting your money.
I recently got my monthly Roth IRA statement. Part of the email was a simple question that asked “Is your IRA beneficiary up-to-date?”. Good question. I wasn’t really slacking on keeping it updated, since I haven’t had a reason to change it. But, keeping track of it certainly wasn’t a priority.
An IRA isn’t the only account or document that has beneficiary designations. Keeping track of them all can be a bit tedious. So an easy beneficiary review checklist is the place to start. Read more…
Options For Your 401k Rollover
When someone leaves their job, what can they do with their 401k funds? Cashing it all out and paying taxes and penalties isn’t a great choice. Leaving it sit and keeping track of the plan administrator till they retire is another option. Taking those 401k funds and rolling it over to another retirement vehicle is probably the best choice. There are several options available when rolling over a 401k plan from an old employer. By doing so you keep greater control over your retirement funds.
Rollover To Your Current 401k
If your new employer also provides a 401k plan, rolling over your old 401k into your new plan is an option. There are a few things to take into account before you head down this road. Read more…
Your 2011 401(k) Contribution Limits
As far as retirement plans go, the 401(k) has become one of the most popular choices available. It’s low cost, easy set up and wide range of investment possibilities have made it a viable option for both large and small businesses. It has also put the sole responsibility of saving for retirement squarely on the shoulders of the employees.
Maximum 401(k) Contribution Limits
If you’re saving for retirement through a 401(k), the total contribution amount will remain the same as in 2010. This applies to 403(b) retirement plans as well.
The maximum 401(k) contribution for 2011 is set at $16,500. If you happen to have more than one 401(k) – for example a Roth 401(k) and regular 401(k) plan or simply multiple employers, the contribution limit applies for the total amount of all your combined 401(k) plans. So if you have two jobs that both provide a 401(k), you can’t contribute $16,500 to each plan, for a total of $33,000. You’ll only be able to add a total of $16,500 between all the plans. Read more…
