There are often multiple investment vehicles to choose from when it comes to saving for your future. You may choose to contribute to your Thrift Savings Plan (TSP) or other retirement account to begin building a retirement nest egg. You may also choose to contribute to a Health Savings Account (HSA) to begin planning for future medical expenses and deductibles.
There are benefits to saving into each of these accounts and regardless of which investment vehicle you use there are important contribution limits and deadlines that must be followed. These contribution amounts and deadlines can be difficult to track as they are updated every few years. Thankfully, your team at Mason & Associates is here to help you keep track of these new contribution limits and any other changes to your retirement benefits. A comprehensive financial plan will help one determine the types of accounts needed to achieve specific goals, attempt to optimize the accounts for a multi-decade tax strategy, and will clarify the underlying investment vehicle, funds, or strategy within each account.
2022 Contribution Limits and Deadlines:
- Thrift Savings Plan:
- $20,500 (younger than age 50)
- $27,000 (age 50 or older)
- Contribution deadline: Last pay period of calendar year.
- If adjustments are needed to reach the contributions limit, ensure that the change results in evenly spreading the contributions over 26 pay periods. The TSP matches 4% per paycheck, thus if you max out early, you will miss matching contributions for the periods that you aren't contributing.
- 401(k), 403(b), and most 457s:
- $20,500 (younger than age 50)
- $27,000 (age 50 or older)
- Contribution deadline: Last pay period of calendar year.
- IRA contribution limits remain unchanged for tax year 2022:
- $6,000 (younger than age 50)
- $7,000 (age 50 or older)
- Contribution deadline: April 15, 2023
- Reminder, you have until April 15, 2022 to contribute for tax year 2021.
- Health Savings Accounts:
- $3,650 single
- $7,300 family
- $1,000 catch up (age 55 or older)
- Each person must have their own account to contribute the catch-up contribution.
- The $7,300 family limit can be contributed into one account or split
- Contribution deadline: April 15, 2023
- Reminder, you have until April 15, 2022 to contribute for tax year 2021.