Popular Saving Strategies for Your Retirement

RetirementBy Melody Hintz-Rau, VP-Employee Benefits, mhintz-rau@bncbank.com.

No matter if you are an employee, an employer, or self-employed, knowing the best ways to save for retirement are extremely important and tax advantageous. Each year, the IRS issues the maximum available contribution and income limitations. For 2014, most of the limits have remained the same as 2013. Here is a short review of the most popular retirement savings strategies:

Type of Plan


Employee Contribution Maximum for 2014
Employee Catch-up Contribution (over age 50)
Employee Tax Deduction Limit
401(k) Plan$17,500$5,50025% of compensations paid to all eligible employees (maximum compensation of $260,000 and maximum total allocation of $52,000)
Defined Benefit PlanN/AN/AActuarial assumptions up to maximum annual benefit of $210,000
403(b) Plan$17,500$5,500Employer and employee contributions not more than 100% of compensation or $52,000
457(b) Plan$17,500$5,500No Limit
SEP IRA$5,500$1,00025% of compensations paid to all eligible employees (maximum compensation of $260,000 and maximum total allocation of $52,000)
SIMPLE IRA$12,000$2,500Match of $1 for $1 up to 3% of compensation
Traditional IRA *$5,500$1,000N/A
Roth IRA * $5,500$1,000N/A
*IRA Income Limitations
Traditional IRA Deductions Phaseout Ranges
Roth IRA Eligibility Phaseout Ranges
Single$60,000-$70,000$114,000-$129,000
Married filing jointly, both active participants in a retirement plan$96,000-$116,000$181,000-$191,000
Married filing jointly, one active participant in a retirement plan$181,000-$191,000$181,000-$191,000

Please consult your tax advisor for additional information and eligibility.

If you have any questions contact BNC Wealth Management today to discuss what we can do for you.

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