While retirement plan
contribution limits have not increased for 2016, taking full advantage of
allowable contributions and any amounts your employer matches is still a good
idea. Contributions you make to employer-sponsored retirement plans reduce your
taxable income because your employer deducts the amount you specify from your
paycheck before taxes.
For 2016, you can contribute
$18,000 to your 401(k), plus another $6,000 if you're celebrating your 50th or
older birthday during 2016. You can save up to $12,500 in your SIMPLE account
this year, plus another $3,000 if you're age 50 or over.
