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Why is there a cap on 401k contributions?
Do traditional and Roth 401k have the same annual contribution limit?Self Employed 401k: contributions vs more available deductions401k Rollover into IRA (First Time Home Buyer)?Am I investing properly for my future?Optimal balence of 401K and charitable savings401k contributions explanationHow do you best invest in retirement accounts with a large income?Getting around discrimination clause on 401K contributions?Is there a way to undo 401k contributions?23 Years Old, With No Debt. Invest into Rental Properties or 401K?
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In theory, the government wants everyone to save up as much as possible for retirement so that citizens don't end up starving when they're no longer able to work. But in practice there is a limit of how much you can contribute to your pension fund (401k/Roth), which discourages people from saving up as much as possible.
What's the rationale behind this? Why not let people contribute more than $19k/year to their 401k?
401k
asked 3 hours ago
JonathanReezJonathanReez
1,73041626
add a comment |
In theory, the government wants everyone to save up as much as possible for retirement so that citizens don't end up starving when they're no longer able to work. But in practice there is a limit of how much you can contribute to your pension fund (401k/Roth), which discourages people from saving up as much as possible.
What's the rationale behind this? Why not let people contribute more than $19k/year to their 401k?
401k
asked 3 hours ago
JonathanReezJonathanReez
1,73041626
add a comment |
In theory, the government wants everyone to save up as much as possible for retirement so that citizens don't end up starving when they're no longer able to work. But in practice there is a limit of how much you can contribute to your pension fund (401k/Roth), which discourages people from saving up as much as possible.
What's the rationale behind this? Why not let people contribute more than $19k/year to their 401k?
401k
asked 3 hours ago
JonathanReezJonathanReez
1,73041626
In theory, the government wants everyone to save up as much as possible for retirement so that citizens don't end up starving when they're no longer able to work. But in practice there is a limit of how much you can contribute to your pension fund (401k/Roth), which discourages people from saving up as much as possible.
What's the rationale behind this? Why not let people contribute more than $19k/year to their 401k?
401k
401k
asked 3 hours ago
JonathanReezJonathanReez
1,73041626
asked 3 hours ago
JonathanReezJonathanReez
1,73041626
asked 3 hours ago
JonathanReezJonathanReez
1,73041626
asked 3 hours ago
JonathanReezJonathanReez
1,73041626
asked 3 hours ago
JonathanReezJonathanReez
1,73041626
1,73041626
add a comment |
add a comment |
1 Answer
1
active
oldest
votes
What's the rationale behind this? Why not let people contribute more
than $19k/year to their 401k?
Retirement accounts are tax-advantaged, removing the caps would benefit the wealthier end of the spectrum and decreases tax revenue. The caps keep the retirement account benefits in line with other progressive tax policies.
answered 3 hours ago
Hart COHart CO
36.9k688104
1
The limit for self-employed is actually much higher, $56k per year. fidelity.com/learning-center/personal-finance/retirement/…
– David McSpadden
2 hours ago
@DavidMcSpadden True, and for employees the $19k limit isn't actually the max contribution, just the max employee pre-tax contribution.
– Hart CO
2 hours ago
add a comment |
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1 Answer
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active
oldest
votes
1 Answer
1
active
oldest
votes
active
oldest
votes
active
oldest
votes
What's the rationale behind this? Why not let people contribute more
than $19k/year to their 401k?
Retirement accounts are tax-advantaged, removing the caps would benefit the wealthier end of the spectrum and decreases tax revenue. The caps keep the retirement account benefits in line with other progressive tax policies.
answered 3 hours ago
Hart COHart CO
36.9k688104
1
The limit for self-employed is actually much higher, $56k per year. fidelity.com/learning-center/personal-finance/retirement/…
– David McSpadden
2 hours ago
@DavidMcSpadden True, and for employees the $19k limit isn't actually the max contribution, just the max employee pre-tax contribution.
– Hart CO
2 hours ago
add a comment |
What's the rationale behind this? Why not let people contribute more
than $19k/year to their 401k?
Retirement accounts are tax-advantaged, removing the caps would benefit the wealthier end of the spectrum and decreases tax revenue. The caps keep the retirement account benefits in line with other progressive tax policies.
answered 3 hours ago
Hart COHart CO
36.9k688104
1
The limit for self-employed is actually much higher, $56k per year. fidelity.com/learning-center/personal-finance/retirement/…
– David McSpadden
2 hours ago
@DavidMcSpadden True, and for employees the $19k limit isn't actually the max contribution, just the max employee pre-tax contribution.
– Hart CO
2 hours ago
add a comment |
What's the rationale behind this? Why not let people contribute more
than $19k/year to their 401k?
Retirement accounts are tax-advantaged, removing the caps would benefit the wealthier end of the spectrum and decreases tax revenue. The caps keep the retirement account benefits in line with other progressive tax policies.
answered 3 hours ago
Hart COHart CO
36.9k688104
What's the rationale behind this? Why not let people contribute more
than $19k/year to their 401k?
Retirement accounts are tax-advantaged, removing the caps would benefit the wealthier end of the spectrum and decreases tax revenue. The caps keep the retirement account benefits in line with other progressive tax policies.
answered 3 hours ago
Hart COHart CO
36.9k688104
answered 3 hours ago
Hart COHart CO
36.9k688104
answered 3 hours ago
Hart COHart CO
36.9k688104
answered 3 hours ago
Hart COHart CO
36.9k688104
36.9k688104
1
The limit for self-employed is actually much higher, $56k per year. fidelity.com/learning-center/personal-finance/retirement/…
– David McSpadden
2 hours ago
@DavidMcSpadden True, and for employees the $19k limit isn't actually the max contribution, just the max employee pre-tax contribution.
– Hart CO
2 hours ago
add a comment |
1
The limit for self-employed is actually much higher, $56k per year. fidelity.com/learning-center/personal-finance/retirement/…
– David McSpadden
2 hours ago
@DavidMcSpadden True, and for employees the $19k limit isn't actually the max contribution, just the max employee pre-tax contribution.
– Hart CO
2 hours ago
1
1
The limit for self-employed is actually much higher, $56k per year. fidelity.com/learning-center/personal-finance/retirement/…
– David McSpadden
2 hours ago
The limit for self-employed is actually much higher, $56k per year. fidelity.com/learning-center/personal-finance/retirement/…
– David McSpadden
2 hours ago
@DavidMcSpadden True, and for employees the $19k limit isn't actually the max contribution, just the max employee pre-tax contribution.
– Hart CO
2 hours ago
@DavidMcSpadden True, and for employees the $19k limit isn't actually the max contribution, just the max employee pre-tax contribution.
– Hart CO
2 hours ago
add a comment |
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