The IRS recently announced the changes to the retirement contribution limits for 2025 for the various retirement account types. To simplify, I’ve included a table of the limits below, including what you would have to contribute bi-weekly, bi-monthly, or monthly to hit the maximum limits if that’s a goal you/your advisor want to achieve.
Most clients like to contribute to these accounts periodically. However, some clients may choose to max out their Roth/Traditional IRAs with one-time contributions. These contributions can be from bonus money received around the end of 2024 / beginning of 2025, brokerage account funds, an inheritance, or other cash inflow.
As a reminder, you have until the tax filing deadline (April 15, 2025, for the 2024 tax filing year) to contribute to a Traditional and Roth IRA. For employer-sponsored retirement plans, most deadlines are at the end of the calendar year. This means you’re limited to making contributions that go through payroll, and generally, the last pay of the year is based on the date you’re paid, not the dates the work was completed.
401(k) and Employer-Sponsored Retirement Contribution Limits for 2025
The 401(k)-contribution limit for 2025 is $23,500 for employee contributions, an increase of $500 from 2024. $70,000 is the combined employee and employer contributions limits.
Starting in 2025, there’s a new contribution maximum specific to those ages 60 – 63. If you turn one of these ages in 2025, you can contribute up to $11,250 as a catch-up contribution, which is $3,750 more than any other age 50 and older. The 50 to 59 and 64 and older catch-up contribution remains at $7,500.
Below are the contribution limits and how much someone would need to contribute to max it out based on how often you’re paid.
Source: IRS
As part of the Secure Act 2.0 that was passed at the end of 2022, there was a provision that was going to force those 50 and older with higher incomes to make catch-up contributions to Roth 401(k), 403(b), etc. accounts. That was initially scheduled to take effect in 2024, however, the IRS announced on August 25, 2023, that this rule will have an “administrative transition period” that will delay this from taking place until 2026.
Roth and Traditional IRAs
The Traditional and Roth IRA limits have not changed in 2025 from 2024. There are still income limits based on your Modified Adjusted Gross Income (MAGI) for making contributions to Roth and Traditional IRAs, so you should consult your accountant or schedule a consultation with Kage Rush to discuss whether you are close to or over these ranges.
Deductible Traditional IRA Income Limits
Roth IRA Income Limits
Simple IRAs
Simple IRA 2025 contribution maximums have increased by $500 from 2024.
Health Savings Accounts
Health Savings Accounts 2025 contribution maximums have increased by $150 for an individual and $250 for a family from 2024.
Other Tax-Advantaged Accounts
Below is a list of other less common accounts and their contribution limits:
Every client situation is different, so you should discuss your cash flow needs with your Whitaker-Myers Wealth Managers advisor for not just retirement goals but other non-financial/financial goals. This should also include a conversation about your sinking funds for a car, home improvement, etc. If you do not have an advisor, the team of advisors at Whitaker-Myers Wealth Managers is ready to help answer any questions you may have.
Planning Ahead – 2025 Retirement Contribution Limit Changes
December 9, 2024
Andrew Young
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