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The latest news and financial insights from your friends at 1st Nor Cal Credit Union.
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Win $50!
There are two member numbers spelled out within the text of this eNewsletter. Find your number and give us a call at
(888) 387-8632 to claim $50!
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Contribution Limits for 2021 Retirement Plans
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by Jason Vitucci, CFP®
The Treasury Department has released the 2021 adjusted figures for retirement account savings. Although these adjustments won’t bring any major changes, there are some minor elements to note. It is always a good idea to start the new year with some goals for your retirement savings.
401(k)s. The annual contribution limit for employees who participate in 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan remains at $19,500 for 2021.
The 401(k) Catch-Up. The catch-up contribution limit for employees age 50 or older in these plans is $6,500 for 2021. Even if you don’t turn 50 until December 31, 2021, you can make the additional $6,500 catch-up contribution for the year.
SEP IRAs and Solo 401(k)s. For the self-employed and small business owners, the amount they can save in a SEP IRA or a solo 401(k) goes up to $58,000 in 2021. That’s based on the amount they can contribute as an employer, as a percentage of their salary; the compensation limit used in the savings calculation also goes up to $290,000 in 2021.
The SIMPLE. The limit on SIMPLE retirement accounts is unchanged at $13,500 in 2021. The SIMPLE catch-up limit is still $3,000.
Defined Benefit Plans. The limitation on the annual benefit of a defined benefit renains at $230,000 in 2021.
IRAs. The limit on annual contributions to an Individual Retirement Account (pretax or Roth or a combination) remains at $6,000 for 2021. The catch-up contribution limit, which is not subject to inflation adjustments, remains at $1,000. (Remember that 2021 IRA contributions can be made until April 15, 2022.)
ROTH IRAs. The contribution limit for 2021 is $6.000, or $7.000 if you’re age 50 or older. Roth IRA contribution are limited based on filing status & income.
Roth IRA Phase-Outs. The inflation adjustment helps Roth IRA savers too. In 2021, the AGI phase-out range for taxpayers making contributions to a Roth IRA is $198,000 to $208,000 for married couples filing jointly. For singles and heads of household, the income phase-out range is $125,000 to $140,000.
FSAs. The annual dollar limit on employee contributions to employer-sponsored healthcare flexible spending arrangements (FSA) is $2,750 in 2021.
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Although these modest increases won’t impact many, it’s natural to have questions anytime the financial landscape changes. If you’re curious about any of the above, please contact us. As a valued 1st Nor Cal member, we welcome you to contact us for a complimentary financial analysis. All meetings are currently being held by phone or screen share as our office remains closed to in-person meetings for now. We have webinars posted to our website along with other financial education information, and we welcome you to view them. For more information about our practice, please visit our website www.vitucciintegratedplanning.com. Wishing you and your loved ones a safe and happy holiday season from all of us at Vitucci Integrated Planning.
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2890 N. Main Street, Suite 201
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Securities through First Allied Securities, a registered broker dealer, member FINRA/SIPC. Advisory services offered through First Allied Advisory Services, Inc. Registered Investment Advisor. Investments not FDIC or NCUA/NCUSIF insured, not insured by Credit Union, may lose value. Products offered are not guarantees or obligations of the Credit Union, and may involve investment risk including possible loss of principal. 1st Nor Cal CU, Bay Area Retirement Solutions and First Allied are all separate entities. Jason Vitucci CA Insurance Lic.: 0F59894, Gene A. Schnabel CA Insurance Lic.: 0663016
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BRANCH LOCATIONS
1111 Pine St, Martinez
538 Center Ave, Martinez
4261 Century Blvd, Pittsburg
8660-E Brentwood Blvd, Brentwood
560 First St, Suite B-106, Benicia
1420 Pomona St, Crockett
2500 Nevin Ave, Richmond
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HOURS OF OPERATION
Mon - Wed: 9:00am - 4:00pm
Thursday: 9:00am - 6:00pm
Friday: 9:00am - 5:00pm
Crockett Branch Hours Only
Mon - Wed: 9:00am - 4:00pm
Thursday: 7:30am - 4:00pm
Friday: 9:00am - 5:00pm
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Your savings federally insured to at least $250,000 and backed by the full faith and credit of the United States Government. National Credit Union Administrations, a U.S. Government Agency.
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We do business in accordance with the Federal Fair Housing Law and the Equal Credit Opportunity Act.
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The information contained in this email (the “Content”) is provided for informational and educational purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The Content is not intended to be and does not constitute financial, investment, tax or accounting advice or a solicitation to buy or sell securities. The Content is necessarily general in nature and is not specific to you or anyone else. YOU SHOULD CONSULT YOUR OWN INVESTMENT, TAX OR ACCOUNTING ADVISORS BEFORE IMPLEMENTING ANY ADVICE INCLUDED IN THE CONTENT. By viewing or utilizing the Content, you agree that you will not hold Marquis Software Solutions, Inc., 1st Nor Cal Credit Union or their affiliates or agents responsible for loss or damages resulting from the Content.
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