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RETIREMENT PLAN INVESTOR

Use your plan ID (available on your account statement) to determine which employer-sponsored retirement plan website to use:

IF YOUR PLAN ID BEGINS WITH IRK, BRK, 1 OR 2

Visit americanfunds.com/retire

IF YOUR PLAN ID BEGINS WITH 34 OR 135

Visit myretirement.americanfunds.com

Announcements

December 17, 2020

2021 contribution limits

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

The table below shows the allowable contribution amounts and dollar limits for 2021 and 2020.

Retirement plan contribution and dollar limits

Type

Limits

 

 

2021

2020

401(k) deferrals (total traditional and Roth employee contributions)

$19,500

$19,500

Catch-up contributions

$6,500

$6,500

Annual additions limit for DC plans

$58,000*

$57,000*

Annual compensation limit

$290,000

$285,000

Lookback year† compensation for Highly Compensated Employees (HCEs)

$130,000

$130,000

Taxable wage base for Social Security

$142,800

$137,700

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 2020 lookback compensation to determine the HCEs for the plan year beginning in 2021.

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.

All Capital Group trademarks mentioned are owned by The Capital Group Companies, Inc., an affiliated company or fund. All other company and product names mentioned are the property of their respective companies.

Use of this website is intended for U.S. residents only.

American Funds Distributors, Inc., member FINRA.

This content, developed by Capital Group, home of American Funds, should not be used as a primary basis for investment decisions and is not intended to serve as impartial investment or fiduciary advice.