Retirement Plan Contribution Limits for 2021 - 401k Maneuver

Retirement Plan Contribution Limits for 2021

The IRS recently announced retirement plan contribution limits for 2021. While most limits remain the same as 2020, some plans will see a limit increase.

Keep reading below to find out exactly how much you can contribute for 2021, and start making plans now to do what you can to max out your retirement savings next year. 

401(k) Retirement Plan Contribution Limits for 2021

retirement plan contribution limits for 2021


Employee 401(k) contribution limits for 2021 will stay the same as 2020 – at $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 is $6,500. 

If you’re 50 or older and need to catch up on your 401(k) retirement savings, the amount you’re able to save remains unchanged at $26,000. If you turn 50 anytime during December of 2021, you’re still eligible to contribute the additional $6,500. 

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 $58,000 for 2021– up from $57,000 in 2020. The $58,000 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 $58,000 in 2021, up from $57,000 in 2020. 

retirement plan contribution limits for 2021

IRA Retirement Plan Contribution Limits for 2021

retirement plan contribution limits for 2021


Individual retirement account contribution limits stay the same for 2021, with a $6,000 maximum contribution limit. This applies to pretax or Roth IRAs.

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

Expert Tip: You can contribute the maximum for 2020 until April 15, 2021. If you have an IRA, plan now to maximize the contribution limit for 2020 before April next year!  


Contribution limits for SEPs, or Simplified Employee Pensions, will go up $1,000–up from $57,000 in 2020 to $58,000 in 2021. 


Contribution limits will remain the same in 2021 for SIMPLE retirement plans. The maximum contribution limit is $13,500, and the catch-up limit is $3,000. 

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 $66,000 to $76,000 for 2021, up from $65,000 to $75,000 in 2020.

For 2021, the adjusted gross income (AGI) phaseout for married couples filing jointly who are contributing to a traditional IRA begins phasing out at $105,000 and disappears at $125,000. This is up from $104,000 and $124,000 for 2020.

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 $198,000 and $208,000 in 2021. This is up from $196,000 and $206,000.

Expert Tip: You can still contribute to an IRA even if you earn too much–it’s just nondeductible.

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 2021 will increase. For 2021, it will be $198,000 to $208,000, up from $196,000 to $206,000 in 2020. 

For heads of household or those filing as single, the phaseout is $125,000 to $140,000, up from $124,000 to $136,000.

Other Retirement Plan Contribution Limits for 2021

retirement plan contribution limits for 2021

Defined Benefit Plans

The limit on the annual contribution of a defined benefit plan in 2021 remains the same at $230,000. 

Saver’s Credit

For low and moderate income workers, the new Saver’s Credit (also known as the Retirement Savings Contributions Credit) limit is increasing to $66,000 for married couples filing jointly–up from $65,000. For heads of the household, the limit has increased from $48,750 to $49,500 in 2021. For singles and married couples filing separately, the limit is $33,000 in 2021, up $500 from 2020.  

How to Save More for Retirement in 2021

retirement plan contribution limits for 2021

With pensions all but gone, the future of Social Security unknown, and healthcare and cost of living increasing, it’s critical that you make saving for retirement a priority. 

While meeting the contribution limit for your retirement plan next year might seem like a stretch, do what you can to get as close as possible. 

Remember, saving for retirement is a long-term game. 

Every dollar you put in now will grow and help you in the future. 

Here are a few steps you can take to save more for retirement next year: 

  1. Meet the company match. If you have a 401(k) and you cannot maximize your 401(k) savings in 2021, at least contribute the minimum of what your company will match because it’s basically FREE money to you. 
  2. And, depending on what your company matches, it may double the amount of what you’re already saving

  3. Contribute more. No matter what retirement savings plan you have, see if you can’t contribute 1% more in 2021. 
  4. It doesn’t matter your age, how much you earn, or how close you are to retirement. Every little bit helps.

    Even if you only save an extra $10, $15, or $50 consistently per pay period, it can make a difference in retirement because that money will grow over time. 

  5. Read your 401(k) statements when they arrive. Knowing how to read and understand the information presented in a 401(k) statement may be vital to your retirement future. 
  6. Pay yourself first. We encourage you to sit down, create a budget for 2021, and see how you can contribute more to your retirement plan(s). 
  7. Remember, if you don’t invest in your future, no one else will do it for you

  8. Seek professionally managed help.  Even though your 401(k) is employer-sponsored, it does not mean your employer is making changes on your behalf. It’s your account. It’s your money. And it’s your job to look out for your future

If you’re hesitant to reach out for advice because you think your account balance isn’t big enough, or you think you’re too close to retirement to get help, don’t let that stop you! 

401(k) Maneuver provides professional account management to help you grow and protect your 401(k).

Our goal is to increase your account performance over time, manage downside risk to minimize losses, and reduce fees that harm your account performance

There are no time-consuming in-person meetings and nothing new to learn, and you don’t have to move your account. 

Simply connect your account to our secure platform, and we regularly rebalance your account for you. 

Have questions or concerns about your 401(k) performance? Click below to book a complimentary 15-minute call with one of our advisors today. 

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