Catch-Up Contributions in 2026: What Investors Age 50+ Need to Know

If you’re an investor age 50 or older planning to make “catch-up” contributions to a retirement plan, 2026 brings several important changes to understand. These include updated contribution limits and a new mandatory Roth catch-up rule for high-income earners that could affect both your taxes and your take-home pay.

What Are Catch-Up Contributions?

Catch-up contributions allow individuals age 50 and older to save above the standard annual contribution limit, helping accelerate retirement savings as retirement approaches.

For 2026, contribution limits are as follows:

• Under age 50: Annual contribution limit of $24,500

• Ages 50–59 and age 64+: Eligible for an additional $8,000 catch-up contribution

• Ages 60–63: Eligible for an enhanced (or “super”) catch-up contribution of $11,250

New Roth Catch-Up Provisions for High Earners ($150,000+)

Beginning in 2026, those who had FICA wages of $150,000 or more in the prior year (as reported in Box 3 of your W-2), any catch-up contributions to your 401k plan must be made to the Roth portion of your plan.  These contributions can no longer be made to the traditional pre-tax portion. 

This rule applies to 401(k) plans, 403(b) plans and 457(b) plans. However, the Roth mandate does not apply to SIMPLE retirement plans.

Because not all retirement plans currently offer a Roth option, employers are being given a transition period to comply. That said, most large employers are expected to implement Roth features to accommodate this requirement.

Plans that do not add a Roth option may be forced to eliminate catch-up contributions for high earners altogether.

What does this mean for you?

If you’re subject to the Roth-only catch-up rule, here’s how it may affect you:

• No tax deduction for catch-up contributions, potentially increasing your current-year income tax bill

• Lower net paycheck, since Roth contributions are made after taxes

• Tax-free withdrawals in retirement from the Roth portion of your 401(k), assuming qualified distributions

Steps to Take Now

• When you receive your 2025 W-2, we suggest that you review Box 3 (FICA wages) to see if your earnings exceed $150,000

• If they do, contact your retirement plan sponsor or HR department to understand how your plan will handle Roth catch-up contributions in 2026

Special Situations: Job Changes and Self-Employment

It’s important to note that the Roth-only rule does not apply if you had no FICA wages from your current employer last year. This commonly affects self-employed individuals and those who may have changed jobs.

For example, if you change employers in 2026, you will typically have $0 in FICA wages from your new employer in 2025. As a result, you are generally exempt from the mandatory Roth catch-up requirement during your first year of employment, regardless of how much you earned at your prior job.

Bottom Line

While Roth catch-up contributions can provide meaningful long-term tax advantages, the loss of pre-tax catch-up contributions may come as a surprise when filing your 2026 return. Understanding how these rules apply to your situation now can help you avoid unexpected tax consequences and make more informed retirement planning decisions.