One of the best ways to save for retirement is to use your company’s 401(k). And it’s about to get even better in 2025.
With the turn of the calendar, some employees will be able to save even more using their 401(k). That means more tax savings in 2025 and more tax-free compounding for years to come.
A special rule change laid out in the SECURE 2.0 Act from 2022 will go into effect on Jan. 1. The new rule increases the catch-up contribution limits for 401(k)s. The thing is, it only applies to a specific set of investors.
Here’s who can benefit and how much they’ll be able to contribute to their retirement savings in 2025.