Money Under 30

IRA Contribution Limits

IRA contribution limits dictate how much you can save in an individual retirement account (IRA) each year. Whether you choose to contribute tax-free dollars to a traditional IRA (that will be taxed when you withdraw the money) or contribute after-tax dollars to a Roth IRA (which you can draw from tax-free at retirement), the government imposes annual IRA contribution limits on your total IRA contributions.

Any IRA contributions you make between January 1st and April 15th of the following year can count to one particular tax year. The contributions do not have to be made all at once, and if you do not use your contribution allowance one year, you lose that benefit. (I.e., you cannot deposit more the next year if you did not contribute anything this year).

2008 and 2009 IRA Contribution Limits

• $5,000 for investors ages 49 and below
• $6,000 for investors 50 and above