For those who can afford to put away money in their retirement and savings account, the biggest question is how much to put in. To do so, you need to understand your limits, like the Roth IRA contribution limits and other tax limitations. Unfortunately, most people don't figure these out until it's tax crunch time and their scrambling to sock away some retirement savings.

That's why it's critical to keep track of Roth IRA contribution limits and other pension saving restrictions on an ongoing basis. That way you can plan ahead and make sure you have the funds on hand to maximize your savings and tax breaks. But, how do you do that, and what are those limitations? Keep reading to find out.

Limits on 401(k) Contributions

In 2006, the U.S. government passed a law that made temporarily high contribution limits (previously set to expire in 2011) a permanent fixture. Today, the annual contribution limit for 401K sits at $15,500 with a $5000 catch-up restriction for those over the age of 50.

Limits on Roth IRA Contributions

Roth IRA contributions sit at a low limit of $5000 for those under the age of 50. That equals out to almost $417 each month. But, if you're 50 and older, you can defer $6000 to your IRA. Those limits are set to increase annually in $500 increments, based on current inflation rates.

If you're currently part of a work-based plan for your IRA and want to convert those to a Roth IRA, there are other constraints in place that could wreak havoc on your plans.

Essentially, if your Modified Adjusted Gross Income is between $95,000 and $110,000 or higher for a single person or $150,000 - $160,000 or higher for a married person, you may no longer be able to deduct contributions to work IRA plans.

SIMPLE IRAs

SIMPLE IRAs are funded both by voluntary salary deductions and employer contributions. Employees, if eligible, can contribute up to 100% of their yearly salary or $11,000, whichever of the two amounts is less. If you're 51 or over, you can make additional annual contributions of up to $2500 - bringing your annual limit to $13,500.

Roth IRA Catch-Up Plans and Limits

If you're 50 or over and want to make catch-up contributions to your retirement savings (Roth IRA, traditional IRA, 401(k)), you are limited to $5000 in additional payments per year. Of course, you can contribute more to a 401(k), but these are tax-deductible limitations.

Remember, before you invest and start saving for your retirement, make sure you understand your limitations, including your Roth IRA contribution limits, so you can best maximize your tax benefits.