As part of my New Year’s resolution, I’ve decided to become more proactive about my retirement savings. So I’m wondering: Are there limits to the amount of money I can contribute to my retirement plan? And can you offer any advice to help me meet my retirement goals?
—Resolute to Retire
According to the experts in the Human Resources Department, the Internal Revenue Service specifies annual retirement limits that determine the maximum amounts both you and the University may contribute to your retirement plan in any calendar year. Keep in mind the contributions you make are on a pre-tax basis, which means they’re taken from your paycheck before income taxes are deducted.
For calendar year 2010, your pre-tax contributions generally cannot exceed $16,500, but this amount may be higher if you are at least 50 years old and/or have at least 15 years of service with the University. The IRS also limits the amount of annual compensation that can be taken into account when calculating retirement contributions. For calendar year 2010, the annual compensation limit is $245,000.
Penn has plenty of resources to help you with your retirement goals. The University’s retirement vendors—TIAA-CREF and Vanguard—can help determine the right investment mix for you and establish an investment strategy to meet your short- and long-term goals. They even offer free one-on-one retirement counseling sessions for faculty and staff. Visit www.hr.upenn.edu/Benefits/Retirement/RetirementCounseling.aspx to make an appointment. You can also visit the Human Resources website at www.hr.upenn.edu/retirement to manage retirement benefits online. It also offers a variety of retirement planning resources, including tips on meeting goals and maintaining retirement security. If you have questions, contact the University Retirement Call Center at 877-PENN-RET (877-736-6738).
Got a question for Benny? Send it via e-mail to firstname.lastname@example.org or via regular mail to the Current, 200 Sansom Place East, 3600 Chestnut Street, Philadelphia, PA 19104-6106.
Originally published on January 21, 2010