2022 contribution limits are finally out! Like most money nerds, Mindy is very excited about the newest increase to retirement account contribution maximums! This is a huge benefit to anyone chasing financial independence as now you’ll be able to invest, and earn, more through tax-deferred and tax-advantaged retirement accounts like the 401k, Roth IRA, 403b, and not-really-retirement-plan HSA.
While most accounts saw some form of an increase over 2021, Roth IRAs, unfortunately, did not see any contribution increase. This isn’t unexpected as Roth IRAs are one of the best tax-advantaged retirement accounts around and already give huge tax benefits to those who fully take advantage of them.
If you’ve already set your contribution maximums for the year, make sure that you re-adjust them for these updated contribution limits. This will help you maximize retirement savings in the future and could help you deduct more from your taxes.
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00:00 Retirement Contributions!
00:36 Tax-Deferred Retirement Plans (401k, 403b, 457, TSP)
01:21 Roth IRAs
01:57 HSAs (Health Savings Accounts)…(read more)
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Hello Mindy. My wife makes 40k and I make 80k; both of our incomes do not include our amounts for benefits. Can I invest in a Roth IRA without penalties?
Hello. Does your annual HSA contributions affect your ROTH like with a traditional IRA? I don’t want to max out my allowed contributions on just one account. Thank you in advance.
Good info but didn’t include married income.
The actual amount that you are allowed to contribute to a Roth IRA is based on your income. To be eligible to contribute the maximum amount in 2022, your modified adjusted gross income must be less than $129,000 if single or $204,000 if married and filing jointly. Contributions begin to be phased out above those amounts, and you can't put any money into a Roth IRA once your income reaches $144,000 if a single filer or $214,000 if married and filing jointly.
And there is always the back door Roth but be careful of Aggregation Rules.
Love your enthusiasm as always!