401k Contribution Limits – Why You Need To Be Aware

Posted on October 31, 2011 @ 1:34 pm

Investing your money on a 401k retirement plan is a highly efficient way to prepare for your future. It is indeed a fact that retiring can only be exciting once you have exerted enough effort to be prepared for it. To put it candidly, you need a good deal of money if you want to explore different places, develop a new hobby, or even to spend more time with grandchildren and relatives. Additionally, medical expenses and other related bills will keep on coming and you need enough money to pay for that as well. All of these could be terribly difficult if you are already out of the workforce and there are no more paychecks to expect.       

This is the exact same reason why you need to talk with a 401k expert regardless if retirement is still 5, 10, or 20 years away. You wouldn’t want to experience the difficulties of running out of cash during your time of need. Your friendly 401k expert could serve as a guide if you want to start building your savings as early as now and ensure that you can have the lifestyle you want in the future. 

First and foremost, you need to know that certain rules and procedures are implemented by the government regarding your retirement contributions. For example, it helps to follow the prescribed yearly 401k contribution limits so you could get a clear idea about how much you can contribute for the whole year. During 2010, the announced 401k contribution limit was up to $15,500 for regular contributors. However, older members are given an exemption to that rule since they can add at least $5,000 more as a catch-up contribution so they can prepare better for their upcoming retirement.

To begin building your retirement savings, you can directly inquire with your employer or seek the assistance of a professional financial expert. This should prove to be a great benefit in the years to come so don’t make the mistake of taking it for granted. 

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