Inflation pushes up 401k contribution limits
Tens of millions of Americans pay into a tax-deferred retirement plan, alongside their employer, with most utilizing a 401k plan. Each year there is a maximum amount that individuals can be required to contribute and with inflation continuing to run high the limits for 2023 will be raised substantially.
A statement from the IRS confirms: “The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased to $22,500, up from $20,500.”
Axios reports that this 9.8% jump is the largest increase ever seen, both in terms of dollars and percentage rise.