The Internal Revenue Service recently announced the contribution limits for retirement accounts effective January 1, 2025. Here’s how much you can save for retirement with a 401(k) and an IRA in 2025:
401(k) Updates for 2025
Contribution Limit. The maximum amount that individuals can contribute to their 401(k) in 2025 is $23,500, an increase from the $23,000 limit in 2024.
Catch-up Contribution Limit. The additional contribution that individuals aged 50 and over can make remains at $7,500 in 2025. This means that their age group can make a total of $31,000 of possible contribution to their retirement funds.
Higher Contribution Limit. Thanks to the SECURE ACT 2.0, an older age group can make higher catch-up contribution to their 401(k). Individuals aged 60 to 63 can contribute up to $11,250 in 2025 rather than $7,500. This increases their maximum potential contribution to $34,750
Combined Employee and Employer Contribution Limit. If you and your employer make contributions to your 401(k), the maximum or the combined (employee + employer) contribution limit in 2025 is $70,000, $1,000 higher from 2024.
This gives individuals aged 50 and over a total combined limit of $77,500, while individuals within the age group of 60-63 gets a total combined limit of $81,250.
IRA Updates for 2025
The contribution limit to an Individual Retirement Account (IRA) continues to be at $7,000 in 2025. Individuals aged 50 and over can still make an additional contribution of $1,000 in 2025, same with 2024.
Higher Income Ranges to Determine Deductibility of Contributions to IRAs
Contributions to IRAs are deductible if certain conditions were met. Below are the income phase-out ranges to determine their deductibility:
Contributions to a Traditional IRA
| Filing Status | 2025 Phase Out Range | 2024 Phase Out Range |
| Single Filer covered by a workplace retirement plan (WRP) | $79,000 – $89,000 | $77,000 – $87,000 |
| Joint Filers, the spouse making the IRA contribution is covered by a WRP | $126,000 – $146,000 | $123,000 – $143,000 |
| Joint Filers, the spouse making the IRA contribution is not covered by a WRP and married to someone who is covered. | $236,000 – $246,000 | $230,000 – $240,000 |
| Separate Filers covered by a WRP | $0 – $10,000 | $0 – $10,000 |
Contributions to a ROTH IRA
| Filing Status | 2025 Phase Out Range | 2024 Phase Out Range |
| Single Filers and Heads of Household | $150,000 – $165,000 | $146,000 – $161,000 |
| Joint Filers | $236,000 – $246,000 | $230,000 – $240,000 |
| Separate Filers | $0 – $10,000 | $0 – $10,000 |
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