About 401(k) Contribution Limits

Series Summary

Finance, whether personal or corporate, refers to money management. By creating a personal budget and managing money, one can organize personal finances to avoid debt caused by frivolous spending. When a surplus of money is formed, investing is an option that makes money work harder. Investing varies from low-risk certificates of deposit to high-risk stocks. Being smart with money can create a healthy savings for the future or retirement. In this free video series on personal finance, an investment professional discusses the ups and downs of a 401(k) retirement savings plan. Find out how to avoid penalties and taxes for withdrawing money early, and learn the IRS restrictions on what constitutes a financial emergency. Get tips on taking out a 401(k) loan, and learn how to form a budget around repayment of that loan. Plan for the unforeseeable future with a 401(k) plan.

Video Transcript

"My name is Phillip Beningoso, I'm an investment professional, and I'm going to be discussing 401K contribution limits. It's important to keep your eye on what amount that is allowed for your 401K contributions. There are two different 401K contribution limits that you're going to really need to be aware of. The government sets the limit allowable, and an employer sets their own 401K limit. So, let's talk a little bit about both. The U.S. government imposes a 401K contribution limit guideline. Okay, the government is beginning to understand the importance of saving for retirement, and has started to increase that limit each year to help people save more money. Now the limit for 2008, 401K contribution limit is fifteen thousand, five hundred. And they also have what's called a catch-up contribution feature, which is for those over fifty years of age, and that is five thousand additionally. Now, check with your employer to find out their contribution limit. This is very important. Any information provided here is for general informational purposes only, and should not be considered an investment advice or personalized investments. Any strategies or investments mentioned here may not be suitable for everyone. My name's Phillip Beningoso, and I'm an investment professional."