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Higher 401(k) Limits in 2023
Dec. 4th, 2022 08:26 amThe contribution limit for 401(k) accounts is increasing for 2023. The government has upped the individual contribution limit a whopping $2,000, from $20,500 to $22,500. The catch-up contribution limit for employees 50+ rises $1k to $7,500. That means for me, as a 50+ person, I get to jam an additional $3k in my account next year.
Yes, I'm maxing out my 401(k) contributions. Yes, I'm fortunate to be able to do that. Not everybody earns enough to save that much. Though frankly it's not just about how much you earn; there's also a choice one makes about how much to save. My partner and I made a choice years ago when our salaries reached a certain point well beyond our current expenses that we would not increase our expenses (say, by buying a larger, expensive house, as so many of our friends did) just because "we could afford it" but instead would save aggressively to afford ourselves a comfortable retirement.
Yes, I'm maxing out my 401(k) contributions. Yes, I'm fortunate to be able to do that. Not everybody earns enough to save that much. Though frankly it's not just about how much you earn; there's also a choice one makes about how much to save. My partner and I made a choice years ago when our salaries reached a certain point well beyond our current expenses that we would not increase our expenses (say, by buying a larger, expensive house, as so many of our friends did) just because "we could afford it" but instead would save aggressively to afford ourselves a comfortable retirement.
