Over 50? The IRS Wants to Boost Your Retirement

Photo by Dean Drobot / Shutterstock.com

Turning 50 opens the door to some special privileges. Retailers offer price breaks, restaurants serve up discounted fare and hotels welcome you with cheaper room rates.

Uncle Sam also salutes older Americans by offering special tax breaks to workers 50 and older who are trying to save for retirement. Yet, millions of people are unaware of this unique opportunity to save more.

Just 46% of self-employed workers and 60% of traditionally employed workers who are 50 or older know that the federal government allows people 50 and older to make “catch-up” contributions to their retirement savings accounts, according to a recent study by the nonprofit Transamerica Center for Retirement Studies.

Are you among the ranks of such workers?

How catch-up contributions work

In 2019, most Americans can contribute a total of $19,000 to workplace retirement accounts like 401(k)s. But Americans 50 and older can contribute an additional $6,000 to certain workplace retirement accounts — an amount the government characterizes as a “catch-up” contribution.

Catch-up contributions are also available to folks saving in individual retirement accounts (IRAs). For example, in 2019, most workers can contribute $6,000 to an IRA. But savers 50 and older can contribute an additional $1,000.

The news gets even better at age 55. At that point, folks with a health savings account (HSA) are eligible for a catch-up contribution of $1,000. That amount is in addition to the HSA contribution limits for 2019 of $3,500 for individuals and $7,000 for families.

You can learn more about catch-up contributions at the IRS website.

How to save more for retirement

Of course, most of us struggle to find two nickels to contribute to retirement savings, let alone $40,000. If saving is a challenge for you, don’t give up hope.

Money Talks News offers an online course — The Only Retirement Guide You’ll Ever Need — that is designed for people between the ages of 45 and 65.

Taught by Money Talks News CEO and founder Stacy Johnson, the course combines lessons, videos, worksheets and quizzes to help you reach your retirement savings goals.

You can also learn more about saving for retirement in Money Talks News stories such as:

How to find cheaper car insurance in minutes

Getting a better deal on car insurance doesn't have to be hard. You can have The Zebra, an insurance comparison site compare quotes in just a few minutes and find you the best rates. Consumers save an average of $368 per year, according to the site, so if you're ready to secure your new rate, get started now.

Read Next
7 Kitchen Gadgets That Make Healthy Cooking a Breeze
7 Kitchen Gadgets That Make Healthy Cooking a Breeze

These small appliances and cooking aids make healthy eating easy — and they’re all available on Amazon.

13 Small Gadgets Under $20 That Make Life Better
13 Small Gadgets Under $20 That Make Life Better

These inexpensive electronics will make your day-to-day life a little easier — and happier.

15 Free Streaming Services to Watch While Stuck at Home
15 Free Streaming Services to Watch While Stuck at Home

These free streaming video services offer thousands of movies and TV shows, including recent releases and beloved classics.

7 Small Appliances You Don’t Need — and What to Use Instead
7 Small Appliances You Don’t Need — and What to Use Instead

Here’s how to get the job done without blowing money — or losing counter space.

3 Reasons You Can’t Rely on Medicare Alone
3 Reasons You Can’t Rely on Medicare Alone

Counting on Medicare to cover health care costs can jeopardize your retirement plans.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
Social Security Checks Likely to Grow This Much in 2021
Social Security Checks Likely to Grow This Much in 2021

The federal government recently released a key statistic that gives clear insight into what next year’s COLA will be.

This Gas Station Scam Is Victimizing More Drivers
This Gas Station Scam Is Victimizing More Drivers

For the second straight year, a growing number of Americans believe they’ve fallen prey to this scam.

21 Things You Should Always Buy at a Dollar Store
21 Things You Should Always Buy at a Dollar Store

Dollar stores have great bargains on both everyday and occasional purchases.

7 Ways to Boost Your Credit Score Fast
7 Ways to Boost Your Credit Score Fast

Your financial security might soon depend upon the strength of your credit score.

7 Unusual Ways to Declutter Your Home
7 Unusual Ways to Declutter Your Home

Tired of possessions weighing you down? Here are seven ways to declutter painlessly and effectively.

This Is the Most Popular Age for Claiming Social Security
This Is the Most Popular Age for Claiming Social Security

Both men and women are most likely to start receiving Social Security benefits at this age.

6 Things You Should Never Buy at Trader Joe’s
6 Things You Should Never Buy at Trader Joe’s

We love Trader Joe’s for plenty of reasons. But think twice about this handful of products.

Don’t Toss These 7 Household Items — Sell Them
Don’t Toss These 7 Household Items — Sell Them

Here’s how to earn cash as you give new life to these unwanted items.

6 Legal Documents Retirees Need — but Don’t Have
6 Legal Documents Retirees Need — but Don’t Have

Few retirees have these documents that are crucial to their golden years — especially during a pandemic.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

These jobs pay more than the typical job in the U.S. — and no bachelor’s degree is required.

5 Awesome Places You Can Retire Overseas on $2,000 a Month or Less
5 Awesome Places You Can Retire Overseas on $2,000 a Month or Less

In this week’s podcast: tips on retiring overseas — from someone who’s been helping American expats for decades.

Eat This Food If You Want to Avoid Alzheimer’s Disease
Eat This Food If You Want to Avoid Alzheimer’s Disease

One type of food associated with the Mediterranean diet offers especially large benefits.

11 Expenses That Quietly Drain Your Wallet
11 Expenses That Quietly Drain Your Wallet

It’s scandalously easy to overspend in these areas of your life.

Could You Give Up These 7 Expenses to Save Thousands of Dollars a Year?
Could You Give Up These 7 Expenses to Save Thousands of Dollars a Year?

You could save more than $30,000 by setting aside these costly expenses for just one year.

10 Deep Discounts Available on Amazon This Friday
10 Deep Discounts Available on Amazon This Friday

These items are all steeply discounted — but the deals won’t last long.

9 Dumb Ways You Are Ruining Your Home Value
9 Dumb Ways You Are Ruining Your Home Value

Homeowners, beware these mistakes that can drive away potential buyers.

18 Amazon Purchases That We Are Loving Right Now
18 Amazon Purchases That We Are Loving Right Now

These practical products make everyday life a little easier.

7 Tips for Building an Emergency Stockpile
7 Tips for Building an Emergency Stockpile

A pandemic or natural disaster could leave you reliant on your existing food supply. Is your pantry prepared?

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.