Some of the most important areas in which to invest in your lifetime is on a home and for your retirement. Many people have a 401k plan. An important part of investing is to always be aware of what amount you are allowed to contribute to your 401k account each year. 401k contribution limits change each year. Within the prior years, the government has increased the contribution limits to help individuals save for retirement.
The U.S. government has put out a list showing the maximum amount you can contribute to your 401k plan for that year. Employers may also set a maximum limit of what is allowed for their employees. For example, your employer might limit 401k contributions to a maximum limit of 15% of an employee's salary. That means that an employee that earns $50,000 a year can effectively max their contribution out at $7,500. There is, also, an annual compensation limit. Please contact your tax advisor for further information. The 2008 401k Contribution Limit is $15,500.
Catch-up Contributions
If you are 50 years of age or older, you may want to check with your employer to see if they offer "catch-up" contributions in your 401k plan. If they do, this will allow you to contribute up to the maximum your employer's plan allows as long as this amount does not exceed the limits that have been imposed by the government. The 2008 Catch-Up Contribution Limit is $5,000.[1]
Finally, similar to retirement, investing in a home is one of the most important investments you will make in your life. Since it is so important, don't rely on anyone to sell your home. Contact the one you can depend on at bobwolfrealtor@gmail.com or via phone at 551-206-1163. You will be happy you did.
[1] Information, compliments of Maxine Wolf, CPA, 201-961-5212.
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