11.01.22 Roth IRA & 401(k) Limits for 2023 / CLARKONOMICS: The Deficit Reckoning

The Clark Howard Podcast

Clark Howard

Investing, Entrepreneurship, Business

4.6 • 4.9K Ratings

🗓️ 1 November 2022

⏱️ 29 minutes

🔗️ Recording | iTunes | RSS

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Summary

The 401(k) contribution limit has been increased for 2023, but this headline buries the lead: New rules for Roth IRA income and contribution limits. And - Clark-onomics: The U.S. deficit. Clark explains how we got here since the budget surpluses of the 90’s and what we can learn from recent events in the UK. New Roth IRA & 401(k) Limits: Segment 1 Ask Clark: Segment 2 Clarkonomics: The Deficit: Segment 3 Ask Clark: Segment 4 Mentioned on the show: IRS Announces Record 401(k) Contribution Limit Increase for 2023 How To Open a Roth IRA Best 529 College Savings Plans By State Economy, Borrowing Costs to Add Upward Pressure on Federal Deficit 4 Ways To Stop Junk Mail How Many Credit Cards Should I Have? 7 of the Best High-Yield Online Savings Accounts in 2022 Banks Are Offering 4.5% CDs—Just Not to Regular Customers Frequently Asked Questions • Max. your best interest. Clark Deals 2022 Sweepstakes Clark.com resources Episode transcripts Clark.com daily money newsletter Consumer Action Center Free Helpline: 636-492-5275 Learn more about your ad choices: megaphone.fm/adchoices Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	It's my pleasure to welcome you to the Clark Howard Shower Emissions to serve you and
0:09.8	empower you to make better financial decisions in your life.
0:14.4	You may have heard that the amount you can put in a 401k or a similar workplace kind
0:20.4	of plan was increased for 23 to huge amounts.
0:26.4	At the headlines buried the lead and in fact it hadn't been talked about at all, Roth IRA
0:32.3	rules changed as well.
0:35.4	And I want to tell you about the changes and the Roth and also I have a carconomic segment
0:41.0	coming for you on the economy and our deficit.
0:45.8	So the Roth IRA contributions which are so key to me have lagged under the law so far behind
0:56.3	what you can put in a 401k.
0:59.9	And why in the infinite wisdom of the U.S. Congress the law is set that way I don't know
1:06.9	because you can put these ginormo amounts into a 401k over 22,500 dollars unless you're
1:17.9	older you can do 30,000 dollars in a year into a 401k.
1:23.4	And that's what all the headlines were about.
1:25.5	But the truth is there's almost nobody who puts into a 401k up to what the federal limits
1:33.1	are even before they reset for 23.
1:38.5	So Roth though on the other hand people have been limited for years to 6,000 dollars.
1:45.2	That's bumping up to 6,500.
1:48.2	If you're 50 years old and over you're allowed to do 7,500 in 23 and this is good news
1:57.5	but I still don't understand the disparity.
1:59.9	I don't get it.
2:01.8	Why people who are let's say self employed or work for a small business doesn't offer
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