The theme this week on the Retirement Quick Tips Podcast is: New Retirement Plan Limits For 2023

Today, I’m talking about increases to catchup contributions for retirement plan accounts in 2023. If you’re over 50, you’re already maxing out your retirement plan contributions but you want to do more, then consider catch up contributions. 

The catch-up contribution limit for employees aged 50 and over who participate in 401(k), 403(b), most 457 plans, and the federal government's Thrift Savings Plan is increased by $1000 for 2023 - to $7,500, up from $6,500. 

This means that if you participate in 401(k), 403(b), most 457 plans, and the federal government's Thrift Savings Plan and you max out both your regular contributions and your catchup, you can reach an important threshold and save $30,000 in your employer-sponsored retirement accounts starting in 2023.

Some important things to know about the catchup that you’ll want to pay attention to. Oftentimes you have to opt into it specifically and your payroll or retirement plan provider won’t automatically let you make the catchup contributions unless you opt in. Every providers is different so just make sure you find out how to max out both your regular and catchup contributions if you decide to go that route. 

As I mentioned yesterday, if you’re listening to this podcast, you probably are over 50 and in your peak earnings years, so trying to max out your retirement plan contributions will help provide a nice boost in your last several working years before retirement. 

Catchup contributions are also going up for SIMPLE IRA accounts, by $500 - from $3000 to $3500, but it’s important to note that the catchup contribution for Traditional and Roth IRA accounts remains unchanged for 2023, and remains at $1000. 

I’ll talk more specifically about Traditional and Roth IRA accounts on Friday.

That’s it for today. Thanks for listening! My name is Ashley Micciche and this is the Retirement Quick Tips podcast.  

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance