Congress has opened up new opportunities in 2020 for people to save more for retirement and earn more money while on Social Security. Here's a breakdown of the new changes for 2020.
{AUDIO} New for 2020: Changes to Social Security and Contribution Limits
Social Security
- Cost of living adjustment: Social Security benefits rose by 1.6% for 2020. This bump in benefit is less than the 2.8% increase in 2019.
- Taxable income limit increased: People making $137,700 or more per year will not be taxed further for Social Security. This income limit increased from $132,900 in 2019.
- Increased earning limits: People receiving Social Security benefits and not of full retirement age (FRA) can now earn up to $18,240 without being penalized. This amount is up from $17,640 in 2019. Earning limits increased from $46,920 in 2019 to $48,600 in 2020 for people at FRA.
Contribution limits
- Traditional and Roth IRAs: Contribution limits on Traditional and Roth IRAs outside of a 401(k) have not changed for 2020.
- 401(k), 403(b) and 457s: Contribution limits have increased $500 from $19,000 to $19,500.
If you have questions regarding Social Security and need help building your retirement plan, give me a call at 320.222.4236 or email me directly at [email protected].