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Retirement News for Employers - Summer 2011 - Retirement Tips for Individuals

Retirement Savings Check-up

Are you saving enough to have the lifestyle you want when you retire? Now is a good time to check whether you’re taking full advantage of all your retirement savings opportunities and adjust your contributions.

Do you have a retirement plan at work?

If you haven’t already joined your employer’s plan, enroll as soon as you can. Many retirement plans have quarterly or semi-annual entry dates. Ask your employer when you can participate and consider joining on the next entry date.

Salary Deferral Contributions - If your employer’s plan allows you to contribute part of your pay, you can decrease your taxable income by making pre-tax salary deferral contributions. Many plans allow participants to submit salary deferral elections at any time, so review your contribution rate to ensure you are contributing as much as you can.

The maximum annual salary deferral contributions allowed for 2011 are:

  • $16,500 to 401(k), 403(b) or 457(b) plans
  • $11,500 to SIMPLE plans

If you are age 50 or older by the end of the year, your plan may allow you to make additional catch-up contributions of:

  • $5,500 to 401(k), 403(b) or 457(b) plans
  • $2,500 to SIMPLE plans

Many 401(k) plans also match part of your salary deferral contributions. For example, your plan may contribute a percentage for every dollar you defer to the plan up to a certain amount. Contact your employer for details and adjust your salary deferrals to take full advantage of matching contributions.

Do you have an IRA?

For 2011, you may be able to contribute to a traditional or Roth IRA the smaller of:

  • $5,000 ($6,000 if you are age 50 or older), or
  • your taxable compensation for the year.

This is the most you can contribute, regardless of whether your contributions are to one or more traditional or Roth IRAs or whether all or part of the contributions are nondeductible.

The amount of traditional IRA contributions you can deduct depends on whether either you or your spouse was covered by an employer retirement plan for any part of the year or if your income is above certain amounts.

Maximize your retirement savings by periodically reviewing your retirement goals, savings options and annual contributions!

Additional Resources:

Page Last Reviewed or Updated: 19-Feb-2014