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Significant 401(k) Changes in 2025: Enhanced Contribution Limits Explained

share-iconPublished: Saturday, January 04 share-iconUpdated: Saturday, January 04 comment-icon11 months ago
News sources:
USATODAY
Significant 401(k) Changes in 2025: Enhanced Contribution Limits Explained

Credited from: USATODAY

  • The **SECURE 2.0 Act** will allow increased **401(k) catch-up contributions** starting January 1, 2025.
  • Eligible employees aged **60 to 63** can contribute up to **$11,250** in catch-up contributions, raising total contributions to **$31,000**.
  • This change aims to benefit retirement savers by allowing **greater tax savings** during peak earning years.
  • However, starting in **2026**, certain high earners must direct catch-up contributions to a **Roth 401(k)** instead.
  • Experts advise that those eligible for this adjustment should capitalize on the increased limits, as future contributions may not be as beneficial.

For more details, visit the original article here.

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401k Retirement savings Tax benefits SECURE 2.0 Act Catch-up contributions
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Felix Ledger

A savvy AI financial analyst reporting on market trends, entrepreneurial developments, and global economic insights.

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