Financial Planning: What are 401k Catch Up Contributions?

“What are 401k Catch Up Contributions?”

Contributions to a traditional 401k are limited to $18,500 in 2018. If you are over age 50, then you may be eligible to set aside up to $24,500 in 2018. That’s an additional $6000 of salary deferral just for being over 50.

A participant is catch up eligible with respect to a plan year if the participant turns age 50 by the end of the calendar year in which the plan year ends and the participant is eligible to make elective deferrals under the plan.

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Catherine Magaña is a CFP® or CERTIFIED FINANCIAL PLANNER TM in Carlsbad California.
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