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As retirement planning becomes increasingly crucial, understanding the changes in 401(k) contribution limits is essential. In 2025, these limits are expected to rise, offering individuals more opportunities to bolster their retirement savings.

Big savers can use after-tax 401(k) contributions to kickstart tax-free retirement savings. Here’s what investors need to know.

The 401(k) contribution limit has seen a notable increase, now allowing individuals to contribute up to $23,500 annually. This change marks a $500 rise compared to 2020, offering more opportunities for retirement savings.

While the official IRS announcement will come later this year, the contribution limit for retirement accounts will likely increase from $23,500 to $24,500 in 2026, according to a new Milliman report.

This new plan, introduced under SECURE 2.0, have lower employee contribution limits compared to traditional 401(k)s and allow for reduced recordkeeping requirements, which reduce administration costs.

If we only had Social Security to rely upon, we would be in a lot of trouble. It’s a broken system built on flawed logic and has been rightly described as a Ponzi scheme. That’s where you need to bring in more investors so you can use their contributions to pay earlier participants.

One of the biggest questions anyone will ask about their financial future is exactly how a 401(k) works. At some point, this important and well-known financial program will stump most people with different rules and regulations regarding taxes,