How Much Can I Put in Retirement Savings in 2020?
There’s great news for 401(k) contributors.
2020 is fast upon us, which makes it the perfect time to start strategizing for next year’s retirement savings. For higher-earning Nurse Anesthetists, the dawn of a new decade boasts some unique benefits for those looking to max out their retirement savings and build a substantial retirement nest egg.
Mindful savers will be happy to know that the IRS has raised the limits on retirement contributions for this coming year. 401(k), 403(b), and most 457 plans have increased from $19,000 to $19,500.
Individuals who are 50 years of age or older can also make a catch-up contribution of $6,500, which is a $500 increase from 2019. These changes mean that if you are over 50 or turning 50 in 2020, you can save up to $26,000 next year in your 401(k). SIMPLE savings plans have also increased to $13,500.
What hasn’t changed are IRA limits, which remain the same at $6000 with catch-up IRA contributions staying at $1000. If you wish to maximize the benefits of this saving strategy, then contacting your financial advisor to explore the benefits of a backdoor ROTH IRA tactic might be a good idea.
It’s important to note that these increases apply to individual earners, and do not consider company matching programs.
If your place of work matches your individual 401(k) contributions, then 2020 stands to be an excellent year for saving and protecting retirement assets.
There’s also great news for CRNAs who work as contractors.
Limits to Solo 401(k) contributions have also been increased from $56,000 (in 2019) to $57,000 (in 2020). If you are a Nurse Anesthetist with multiple revenue streams, this increase bodes well for maximizing your savings while also reducing your tax burden. That said, maximizing this benefit will require a solid game plan that is clear and simple to follow throughout the next year.
For CRNAs who work solely as contractors, the limit on a Solo 401(k) remains at 20% of your total income. Like any Solo 401 contributor, it would be wise to map-out your saving strategy with a financial advisor who’s familiar with CRNA contract work. In so doing, you’ll be able to develop simple processes that will help you take advantage of these new changes.
The IRS changes to retirement savings plans mean that 2020 is a great year to innovate and improve your financial strategy. Make retirement planning a part of your New Year’s resolution, and enjoy the benefits of financial growth and stability. Plan today so you can enjoy retirement tomorrow.
To find out how the new changes to savings plans can best serve you, get in touch. We’d love to help you grow your savings and build your nest egg.
Book a free consultation.