The IRS announced the IRA and 401k contribution limits for 2021 and it was not a very exciting announcement. They’re exactly the same as this year. This applies to 403bs, 457s and TSPs as well (the $19,500 limit).
They did change the Roth IRA income limits though. (You’re only allowed to contribute to a Roth IRA if your income is below a threshold). If you’re single, in 2020 your income has to be under $124,000 to make the full Roth IRA contributions of $6,000. Next year that number is changing.
Drumroll please and hold onto your hats…
In 2021, that the single income limit is changing from $124,000 to $125,000.
The married filing jointly income limit has an equally shocking adjustment from $196,000 to $198,000.
And of course, you can likely do a “backdoor Roth IRA” if you’re over these income limits anyway.
I don’t know guys… I try to make my posts at least a little spicy but this one is pretty bland. But I thought I’d pass on the lack of news.
As always, reminding you to build wealth by following the two PFC rules: 1.) Live below your means and 2.) Invest early and often.