January is a great time to reflect on the previous year and to make plans for the year ahead. It is a good time to reassess your cashflow and budget for the coming year including how much to save for retirement in 2024, and the best option to invest those savings.

Once you have reviewed your cashflow and determined how much you can save this year, the next step is to determine if those savings should be made on an income tax-deferred or after-tax basis.

Subject to income limitations, the 2024 contributions limits for retirement accounts have increased to:

  • Traditional and Roth IRA – $7,000 ($8,000 age 50 or older)
  • SEP IRA – 25% of compensation (limit $69,000)
  • SIMPLE IRA – $16,000 ($19,500 age 50 or older)
  • 401(k), 403(b) and 457(b) – $23,000 ($30,500 age 50 or older)

The easiest way to make sure your savings goal is met is to automate the contribution. If participating in a retirement plan at work, contributions will typically be deducted each pay period. For after-tax savings, we recommend establishing a monthly transfer from a payroll account to a savings or an investment account.

If you have not yet made 2023 contributions to your IRA, Roth IRA, SEP IRA or Individual 401(k), you can still do so up until April 15, 2024, including approved filing extensions.

Eagle Ridge Investment professionals welcome an opportunity to work with you to determine how much you can save for retirement as well as for other goals you may have this year, and the best way to do it.