What Are the Maximum 401(k) Contribution Limits for 2018?
Note: This article is about the 2018 401(k) contribution limits. If you're looking for 2017's limits, you can find them here.
401(k) plans are the most widely used type of employer-sponsored retirement savings plan, and their contribution limits and tax advantages are generous. For 2018, the elective contribution and overall 401(k) contribution limits are rising, providing an even greater opportunity for savers to build a nest egg. Let's go over the 2018 401(k) contribution limits and tax benefits, the limits for similar types of retirement accounts, and some tips to help you maximize the value of your 401(k).
For 2018, the limit for elective 401(k) contributions is increasing by $500 from its 2017 level to $18,500. After holding the elective deferral limit constant last year, the IRS chose to increase the 2018 limit in order to keep up with the rising cost of living. However, the catch-up contribution limit for 2018, which allows savers aged 50 or older to contribute even more, remains constant at $6,000 for a total maximum of $24,500.
Source: Fool.com
