We're sure that, right after Father Time rang in 2003, you kissed your beau, considered your resolutions, and wondered whether the contribution limit on your retirement account would increase. The good news is… yes. That is, yes, the contribution limits on many retirement accounts will increase this year. Here's the lowdown:
401(k), 403(b), 457 accounts, and SARSEPs: The annual contribution limit increases from $11,000 to $12,000 for 2003, and the catch-up contribution limit (for those age 50 and older) increases from $1,000 to $2,000.
SIMPLE IRAs: The contribution limit increases to $8,000, and the catch-up contribution (again, for the half-centenarians and beyond) to $1,000.
- Traditional and Roth IRAs: For 2003, the limit will stay at $3,000, and the catch-up contribution limit will remain $500.
So, if money is taken out of your paycheck and deposited in a retirement account, and that amount is based on 2002 limits, contact your human resources department and have the amount changed.
Also, remember that it's not too late to contribute to an IRA for 2002, but you only have until April 15. If you'd like to learn more, visit our IRA Center.
Don't know how much you should be saving? Then find out how to retire in comfort.