One of the golden rules of personal finance is to contribute enough to an employer-based retirement fund to secure the full company match, but what happens to your paycheck if you max out your 401(k)? To get the answer, it’s essential not to think of 401(k) contributions as saving for retirement, but instead to view them as the purchase of a very big tax cut. A Six-Figure Earner Maxes Out In 2026, the IRS allows a maximum contribution of $24,500 to traditional 401(k) plans. Since Bureau of Labor Statis ...

Core Insights - The One Big, Beautiful Bill Act (OBBBA) was signed into law on July 4, 2025, introducing various tax benefits including increased standard deductions and additional deductions for seniors [1] State-by-State Summary - **California**: Households are expected to save approximately $2,293, with standard deduction savings of $182.77 and itemized deduction savings of $5,221. Seniors will save an average of $1,386.60 [2] - **Oregon**: Each household is projected to save around $2,227, with standard deduction savings of $194.73 and itemized deduction savings of $5,502. Seniors could save about $1,131.84 [3] - **Massachusetts**: Households may save $2,150, with standard deduction savings of $190.19 and itemized deduction savings of $5,507. Average savings for seniors is approximately $1,110.96 [4] - **Connecticut**: Expected savings per household is $2,125, with standard deduction savings around $192.41 and itemized deduction savings of $5,495. Seniors will see average savings of $1,386.60 [5] - **Hawaii**: Households are set to save about $2,078, with standard deduction savings of $194.16 and itemized deduction savings of $5,521. Seniors are expected to save around $1,388.04 [6] - **New Jersey**: Residents can expect savings of $1,896 per household, with standard deduction savings of $188.18 and itemized deduction savings of $5,339. Seniors will save approximately $1,387.08 [7]

There's a reason retirement savers are often quick to take advantage of accounts like IRAs and 401(k). These accounts offer different tax breaks, making it easier to set money aside for the future. But IRAs and 401(k)s aren't the only accounts that offer tax savings. Health savings accounts, or HSAs, are another tax-advantaged tool it pays to sign up for if you qualify. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now, when you join ...

Core Insights - The article discusses the implications of turning 65 and transitioning to Medicare, particularly regarding Health Savings Accounts (HSAs) and the potential loss of tax advantages associated with them [1][2][3]. HSA and Medicare Transition - Upon turning 65 and enrolling in Medicare, individuals lose the ability to contribute to their HSAs, which can impact their retirement savings strategy [1][3]. - While tax-free withdrawals for qualified medical expenses remain available, the inability to add funds may lead to a decrease in account balance over time unless investments are managed wisely [3][4]. Employer Health Plans and HSA Contributions - Some individuals may choose to remain on their employer's health plan while also enrolling in Medicare Part A, but this decision prevents further HSA contributions [4]. - Flexible Spending Accounts (FSAs) can serve as an alternative for tax-advantaged savings for those who continue working while on Medicare, with a contribution limit of $3,400 for 2026 [5]. Long-term Tax Planning - For those who enroll in Medicare and continue working, long-term tax planning becomes essential to manage expected tax liabilities throughout retirement [5][6]. - A Roth conversion is suggested as a strategy to maintain tax-free growth and withdrawals, particularly beneficial for high-income retirees facing potential tax rate increases in the future [7].

This story was originally published on CFO.com. To receive daily news and insights, subscribe to our free daily CFO.com newsletter. While opinions on the One Big Beautiful Bill Act are mixed, a recent survey indicates that a plurality of CFOs expect their companies to benefit from it. So said 44% of the 233 finance chiefs who participated in Grant Thornton’s fourth-quarter survey, compared with only 18% who believed the law would harm their financial position. According to the survey report, companies ar ...

Group 1 - Many individuals prefer traditional IRAs or 401(k)s for retirement savings due to the upfront tax benefits, which can lead to significant tax savings annually [1] - Traditional retirement accounts come with the obligation of required minimum distributions (RMDs), which can result in substantial tax implications if not managed properly [2][7] - There is a potential way to avoid RMDs this year, particularly for those who are still employed and do not own 5% or more of their employer's company [3][4] Group 2 - The exemption from RMDs applies only to the retirement plan of the current employer, meaning individuals may still need to take RMDs from other accounts like IRAs [5] - If RMDs cannot be avoided, individuals can consider donating their RMD directly to charity to mitigate tax liabilities [6] - RMDs can also be utilized for personal benefits, such as funding family vacations or home renovations, enhancing the quality of life for retirees [8][9]

Core Insights - Many individuals aim to max out their IRA contributions each year, but various life events, such as unexpected medical bills or inflation, can hinder this goal [1][2] Group 1: IRA Contribution Deadlines - Unlike 401(k) plans, which have a contribution deadline of December 31, IRAs allow contributions until the tax-filing deadline of the following year, which is April 15 for 2025 contributions [3] - The maximum IRA contribution for 2025 was $7,000 for individuals under 50, and $8,000 for those aged 50 and older due to a catch-up contribution [4][8] Group 2: Benefits of Maxing Out IRA - Contributing more to the 2025 IRA can enhance long-term investment potential and provide tax benefits, potentially reducing the tax bill for the current year [5][6] - Additional contributions can help offset tax liabilities from gains in taxable accounts or unreported income from side hustles, thereby lowering the overall tax burden [7]

Core Insights - Life insurance settlements present an opportunity for clients to donate to charities while benefiting from current tax laws before potential changes occur in 2026 [1][5] - Selling life insurance policies on the secondary market allows policy owners to receive a lump sum, especially if their insurance needs change [2][3] - The average life settlement sale last year yielded 6.5 times the cash surrender value of the policies, indicating strong institutional demand [5][6] Industry Trends - The life insurance settlement market has seen sellers receive over $2.5 billion more than potential payouts from lapses or surrenders over the past four years [6] - Despite the significant financial benefits, only a small fraction of the 11 million life insurance policies in the U.S. are involved in settlements, with 2,699 transactions reported [6] - The total proceeds from these transactions exceeded $600 million, highlighting the market's potential [6] Considerations for Policyholders - Policyholders are advised to consult licensed advisors to ensure their interests are prioritized, rather than dealing directly with buyers [4] - Factors to consider include ongoing insurance needs, alternative liquidity options, tax implications of lump sum payments, potential impacts on family members, and privacy concerns regarding health information [7]

Core Insights - As the year-end approaches, many Americans are focusing on holiday activities, but it is also a critical time for financial deadlines that could impact tax liabilities and savings [1][2] Group 1: Financial Moves Before Year-End - The deadline for contributions to 401(k) retirement plans is December 31, with opportunities for catch-up contributions for those over 50 [3] - A significant number of employees are not maximizing their employer's 401(k) match, with 24% saving less than the match cap from 2013 to 2022 [4][5] - Tax loss harvesting is an underutilized strategy that allows investors to convert capital losses into tax savings, with the ability to offset capital gains and reduce taxable income by up to $3,000 [6][7]

Core Viewpoint - Suze Orman advocates for the Roth 401(k) as the optimal retirement savings account due to its tax advantages during retirement [3][7][8] Group 1: Advantages of Roth 401(k) - Roth 401(k) accounts provide tax-free withdrawals in retirement, which do not count as taxable income, thus avoiding potential taxes on Social Security benefits and higher Medicare premiums [7] - Contribution limits for Roth 401(k) are higher than those for Roth IRAs, allowing for greater tax-advantaged retirement savings [7] - The account allows individuals to skip immediate tax savings in favor of more significant tax savings later in life [5][6] Group 2: Comparison with Traditional 401(k) - Traditional 401(k) contributions reduce taxable income in the year of contribution, providing immediate tax savings [4] - In contrast, Roth 401(k) contributions are made with after-tax money, meaning no immediate tax deduction is available [5] - The trade-off is that while traditional 401(k) offers upfront tax benefits, Roth 401(k) offers long-term tax-free growth and withdrawals [5][6]