personal finance

Roth IRA Contribution Income Limits For 2023


I am so happy to have some good news for Roth IRA investors finally. For 2023, the Roth IRA contribution limit will finally be increasing. While not life-changing, the new 2023 Roth IRA contribution limit is $6,500. This is up from the $6,000 Roth IRA limit in 2022.

Why should you care about an increase in the Roth IRA contribution limits for 2023? Mostly because investing in a Roth IRA is a great way to grow your retirement nest egg in a way that will provide tax-free income in retirement. While you won’t get a tax deduction for your Roth IRA contributions, your Roth IRA assets will grow tax-free and can be withdrawn tax-free if you follow the Roth IRA rules and regulations.

2023 Roth IRA Contribution and Income Limits

The maximum allowable contribution to a Roth IRA in 2023 is just $6,500 for those below 50. Assuming you are allowed to make the maximum contribution and earn more than $60,000 per year, you will likely need to invest more for retirement elsewhere. If you are 50 or older, you can make a Roth IRA catch-up contribution of $1,000 for a grand total of $7,500 in 2023. This is the first Roth IRA contribution limit increase since 2019.

However, your Roth IRA contribution may be limited or even eliminated depending on your household income. If you want to max out your Roth IRA in 2023, your income must be below $138,000 as a single filer. This number is just $218,000 for those who have married and are filing jointly (yet another example of the marriage penalty in the tax code). Your contributions will begin to be phased out if your household income is above these levels. Roth IRA contributions are completely eliminated once your household income reaches $153,000 as a single filer or $228,000 as a married couple filing jointly.

For those who are low-income or working part-time, you can only contribute up to your modified adjusted gross income (MAGI). So, if you made less than $6,500 (or $7,500 age 50+), your maximum Roth IRA contribution in 2023 would be limited to 100% of your income. For example, if you worked part-time in retirement and had a MAGI of $4,200, you would only be able to contribute $4,200 to your Roth IRA in 2023.

Put Your Roth IRA Contributions on Autopilot

I’m a big fan of saving time and brainpower when handling personal finance and retirement planning. The more you can automate your investing, the easier it will be to stay on track with your financial goals. If you know your income will allow you to contribute the maximum amount to your Roth IRA in 2023, set up automatic monthly contributions. Take $6,500 (or $7,500 if age 50+) and divide by the number of months left in the year. For example, if starting in January, you would have 12 months to get the total $6,500 into your Roth IRA, so set up an automatic contribution of $541.67 per month.

If you have $6,500 sitting around in a low-interest bank account, perhaps you write a check and make the whole contribution now.

If your income may limit your Roth IRA contribution, set up the contributions to a taxable investment account and move the money over to the Roth ahead of filing your taxes when you know exactly what your MAGI will be and how much you can contribute to your Roth IRA for 2023. You have until April 15, 2024, to contribute to your Roth IRA for 2023.

Even if you can’t max out your Roth IRA in 2023, make sure you are investing for retirement. Starting small can build a saving habit. When I was 22, a good friend advised me to contribute $25 per month. At the time, it seemed like a lot of money, but I didn’t really miss it.

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How To Become a Roth IRA Millionaire

The relatively low contribution limits will make it hard to become a Roth IRA millionaire quickly. But it is still doable. You may be able to get there faster using a Roth 401(k) or by utilizing some of the back door Roth or mega back door Roth strategies to build the maximum tax-free income in retirement.

Assuming you can contribute $6,500 today and each year going forward and earn a 10% return on average per year over the long term, it would take about 28-29 years to become a Roth IRA millionaire. Gotta love the magic of compound interest when $182,000 in contributions turns into a million dollars, especially when this happens in a Roth IRA, which can be turned into tax-free retirement income.



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