Key Points - The article discusses important changes in retirement savings plans as 2026 approaches, focusing on IRA, 401(k), and HSA limits, as well as implications for higher earners [1] Group 1: IRA Changes - IRA contribution limits will increase in 2026, allowing savers under 50 to contribute up to $7,500, while those 50 and older can contribute a total of $8,600, which includes an $1,100 catch-up contribution [2][3] Group 2: 401(k) Changes - 401(k) contribution limits will also rise in 2026, with the maximum contribution for savers under 50 increasing to $24,500, and for those 50 and older, the total allowable contribution will be $32,500, including an $8,000 catch-up contribution [4] - A new super catch-up option will allow savers aged 60 to 63 to contribute an additional $11,250, bringing their total limit to $35,750 [5] - Starting in 2026, higher earners (those earning over $145,000) will only be able to make 401(k) catch-up contributions through a Roth 401(k) [6] Group 3: HSA Changes - HSA contribution limits will increase in 2026, allowing individuals with self-only coverage to contribute up to $4,400 and those with family coverage to contribute up to $8,750. Additionally, individuals aged 55 and older can make a $1,000 catch-up contribution [9]

Overview of Trump Accounts - New tax legislation creates tax-advantaged investment accounts for every child born from the beginning of 2025 through the end of 2028 [1] - These accounts are designed to provide a savings vehicle for families interested in creating savings accounts for their children [2] Contribution Limits and Eligibility - Eligible newborns receive a $1,000 contribution from the government, and other children under 18 may also be eligible [3] - Parents can contribute up to $5,000, and employers can contribute up to $2,500 to these accounts [5] Access and Usage of Funds - Individuals can access these funds at age 18 and must withdraw all funds by age 25 [7] - Funds can be used for qualified expenses such as a first home purchase or educational purposes, and some health-related expenses [7][8] Tax Implications - Contributions are made after tax, and withdrawals can be taxed at the capital gains rate [9] - Unlike Roth-style accounts (after-tax contributions, tax-free withdrawals) or traditional IRAs (pre-tax contributions, taxed withdrawals), Trump accounts have tax implications on both ends [10] Comparison to Other Savings Vehicles - Families should consider Trump accounts versus educational savings accounts, HSAs, 529s, and IRAs [4][8] - The program's $1,000 contribution raises concerns about becoming a broader new entitlement program [6] Potential Drawbacks - Tax industry notes that families may pay tax on both contributions and withdrawals, reducing the tax advantage compared to other retirement accounts [11] - Tax industry suggests policymakers should have promoted a universal savings account instead of adding to the existing complex system [12]