How much can be contributed to a 403(b) retirement plan?

Contributions by you, your employer and a state convention (if applicable) can total the lesser of:

  • $56,000 for 2019 and $57,000 for 2020, OR
  • 100% of your includible compensation

Within this limit, the General Limit on salary reduced contributions is $19,000 for 2019 and $19,500 for 2020. This limit can be greater if you are 50 years of age or older, up to an additional $6,000 for 2019 and $6,500.00 for 2020. This additional amount is called a Catch-Up Contribution. In determining your compensation, do not include housing allowance. Salary reduced contributions can be Tax-Sheltered or Roth Elective Deferrals.

Most Americans will need 70% to 100% of their pre-retirement income at retirement. In order to provide for this level of income at retirement, financial planners frequently recommend to younger clients that they make contributions of at least 10% to 20% of their gross salary into a retirement account.

For clients who have not been making contributions into their retirement account of at least 10% each year, they may need to contribute even more than 20%.

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