New Retirement Plan Contribution Limits for 2020

The IRS recently announced new retirement plan contribution limits for 2020, which means you have the opportunity to save even more next year.¹

With company pensions disappearing and the future of Social Security unknown, Americans are now more responsible than ever to ensure they are set for retirement. 

Whether it’s a 401(k), Individual Retirement Account (IRA), or other form of savings, it’s up to you to create your own retirement income.  

If you aren’t thinking about your retirement income now…

If you haven’t given thought to the lifestyle you want when you retire…

If you don’t have a plan on how to meet your retirement goals… 

Chances are you’ll be like too many Americans and NOT have enough income at retirement. 

Take a look below for the changes to retirement plan contribution limits for 2020, and do what you can to maximize your savings next year. Your future self will thank you!

401(k) Retirement Plan Contribution Limits for 2020

retirement plan contribution limits for 2020


Employee 401(k) contribution limits for 2020 have gone up from $19,000 in 2019 to $19,500. This applies to 401(k), 403(b), most 457 plans, and the federal Thrift Savings Plan. 

For those age 50 and older, the 401(k) catch-up contribution limit will also increase $500–from $6,000 in 2019 to $6,500 in 2020.

This means if you’re 50 or older and need to catch up on retirement savings, you’ll be able to save $26,000 in your 401(k) in 2020. If you turn 50 anytime during December of 2020, you’re still eligible to contribute the additional $6,500. 

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After-tax 401(k) Contributions

If you are self-employed or your employer allows for after-tax contributions, the overall defined contribution plan limit will increase to $57,000 for 2020–up from $56,000 in 2019. The $57,000 is a cap of the maximum $19,500 contribution limit deferral plus employer contributions. 

Solo 401(k)s 

If you have a Solo 401(k), otherwise known as a Self-Employed 401(k) or Individual 401(k), the contribution limits will increase to $57,000 in 2020, up from $56,000 in 2019.

IRA Retirement Plan Contribution Limits for 2020

retirement plan contribution limits for 2020


Individual retirement account contribution limits stay the same for 2020, with a $6,000 maximum contribution limit. 

The catch-up contribution for people age 50 and over remains the same additional $1,000.  


Contribution limits for SEPs, or Simplified Employee Pensions, will go up $1,000–up from $56,000 in 2019 to $57,000 in 2020. 


Contribution limits will increase in 2020 for SIMPLE retirement plans. The maximum contribution limit will be $13,500 for 2020, up from $13,000 in 2019. 

Deductible IRA Phaseouts

The tax deduction for singles and heads of household who are covered by a workplace retirement plan, such as a 401(k), and contribute to a traditional IRA, the phaseout range is $65,000 to $75,000 for 2020, up from $64,000 to $74,000.

For 2020, the adjusted gross income (AGI) phaseout for married couples filing jointly who are contributing to a traditional IRA begins phasing out at $104,000 and disappears at $124,000. This is up from $103,000 and $123,000 for 2019. 

If you contribute to an IRA but are not covered by a workplace retirement plan, and are married to someone who is, the deduction is phased out if your joint income is between $196,000 and $206,000. This is up from $193,000 and $203,000 in 2019.

Lastly, if you’re married but filing separately and you’re covered by a workplace retirement plan, the phase-out range remains $0 to $10,000.

retirement plan contribution limits for 2020

Roth IRA Phaseouts

The phaseout range for married couples filing jointly who are covered by a workplace retirement plan and contribute to a Roth IRA in 2020 will be $196,000 to $206,000, up from $193,000 to $203,000 in 2019. For heads of household or those filing as single, the phaseout is $124,000 to $139,000, up from $122,000 to $137,000.

Other Retirement Plan Contribution Limits for 2020

retirement plan contribution limits for 2020

Defined Benefit Plans

The limit on the annual contribution of a defined benefit plan in 2020 will be $230,000–up from $225,000 in 2019. 

Saver’s Credit

For low and moderate income workers, the new Saver’s Credit (also known as the Retirement Savings Contributions Credit) limit is $65,000 for married couples filing jointly–up from $64,000 in 2019. For heads of the household, the limit has increased from $48,000 in 2019 to $48,750 in 2020. For singles and married couples filing separately, the limit is $32,500 in 2020, up $500 from 2019.  

Save More for Retirement in 2020

retirement plan contribution limits for 2020
With healthcare and cost of living rising and tax rules unknown in 5, 10, 20 years, it’s crucial to have enough money saved to comfortably retire.

Let’s say you had a $250,000 average balance at retirement age, and you were making $50,000 per year at your job when you retire. 

How long do you think these funds are going to last you in retirement? 

Will this give you the retirement you truly desire? 

For most, the answer is no. Not even close! 

There is one way that may ensure you have enough to live on during retirement… contribute the maximum amount in any given year

Even if you’re close to retirement, it’s not too late to do what you can to take advantage of the catch-up contributions and save the most allowed. 

If you have a 401(k) and you can’t max out the annual contribution limits for 2020, at least put in enough to get the full company match. Because when your company matches you, it’s like getting free money

We encourage you to sit down, create a budget for 2020, and see how you can contribute more to your retirement plan(s). 

Remember, if you don’t invest in your future, no one else will do it for you

If you’d like more tips on how to have more income at retirement, download our guide on How to Supercharge Your 401(k) Performance Today .
retirement plan contribution limits for 2020

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