contribution-limits | American Funds

News & Announcements

2018 contribution limits

December 14, 2017

Contribution maximums and other dollar limits are readjusted annually based on inflation.

The table below shows the allowable contribution amounts and dollar limits for 2018 and 2017.

Retirement plan contribution and dollar limits
Type Limits
  2018 2017
401(k) deferrals (total traditional and Roth employee contributions) $18,500 $18,000
Catch-up contributions $6,000 $6,000
Annual additions limit for DC plans $55,000* $54,000*
Annual compensation limit $275,000 $270,000
Lookback year compensation for Highly Compensated Employees (HCEs) $120,000 $120,000
Taxable wage base for Social Security $128,400 $127,200
Taxable wage base for Medicare Unlimited Unlimited

* The DC annual additions limit is effective for limitation years ending in the calendar year.

Use current lookback year compensation to determine HCEs for the following year. For example, use the 2017 lookback compensation to determine the HCEs for the plan year beginning in 2018.

Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.

Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectuses and summary prospectuses, which can be obtained from a financial professional and should be read carefully before investing.