Beginning in 2024, workers will be allowed to contribute up to $23,000 to their 401(k), an increase of $500 from this year. The increase applies to other retirement savings accounts, including the 403(b) plan, most 457 plans and the federal government’s Thrift Savings Plan.
It’s not necessarily about how much you make; it’s about how much you spend. For example, if you make the median US household income ($74,580) but spend at the poverty line ($30,000 assuming a family of 4), then you’ve got $44,580 to save/invest – which is enough to max out one wage earner’s 401k ($23,000), IRA ($7,000), spousal IRA ($7,000), and HSA ($8,300) and have $280 left over to put in taxable investments. (In case you think I forgot to account for taxes, note that all these tax-deferred investments would do just that: lower your AGI so much that your current-year tax liability would probably be wiped out completely.)
The trick is living way, way, way below your means. This blog has good advice on how to accomplish that.
Let me stop you right there because I don’t make anything near the median income.