If you have a 401k, SEP IRA, simple IRA, or HSA, you’ll be able to contribute more to your account(s) next year, which can help you build your retirement savings! The limit on contributions changes from one year to the next due to inflation. However, the limits don’t change every year, and this year they don’t impact all types of retirement accounts.
How have the contribution limits changed?
The contribution limits have increased slightly for some types of accounts, and they have stayed the same for others.
2020 Investment Account Contribution Limits:
| Account | 2019 Limit | 2020 Limit |
| Traditional, Roth IRA & ESA | $6,000 | $6,000 |
| 401(k) | $19,000 | $19,500 |
| Individual HSA | $3,500 | $3,550 |
| Family HSA | $7,000 | $7,100 |
| SEP IRA | $56,000 | $57,000 |
| Simple IRA | $13,000 | $13,500 |
| Catch up Contributions for Simple IRAs | $6,000 | $6,500 |
What will these changes mean for investors?
These changes will mean that investors will be able to put more money aside for the future, which will lead to a potentially larger nest egg.
Furthermore, it will help to reduce the tax burden on the retirement funds of millions of Americans. In fact, these changes have significantly increased the contribution limits for many investment accounts!
What changes can you expect in the future?
The contribution limits are expected to continue increasing in the future due to inflation. The specific amount that contribution limits will increase by depends on the inflation rate at the time as well as other economic factors, which are difficult to predict.
Therefore, it’s important to stay up to date on future changes to investment account contribution limits, which will allow you to make the most of your retirement accounts every year.
Luckily, opening a Quest account can allow you to easily deposit checks into your investment accounts as quickly as possible, and we’ll do it for free within 24-48 hours. Furthermore, our specialists can ensure that you stay up to date on the latest contribution limits. So, open a Quest account today!