403(b) Contribution Limits Have Increased
While there have been new changes affecting a broad spectrum of retirement plans , including Regular IRA’s and 401k’s; we want to make it very clear that we DO NOT endorse these types of plans for ministers. The only retirement plan a minister should use is a clergy-specific 403(b). Doing otherwise will cause you to forfeit valuable tax savings and benefits…like your housing allowance benefits. Compare the benefits of typical retirement plans for ministers,’ learn more here.
2020 403(b) contribution limits:
Under age 50:
The limit for contributions (employee and employer) is $57,000.
The employee deferral portion is limited to $19,500.
Age 50 and over:
The limit for contributions (employee and employer) is $63,500.
The employee deferral portion is limited to $26,000.
*Remember, there must be $1 of includible Compensation for every $1 of Employer Contribution