-
One of the hallmarks of a 401(k) plan is its generous contribution limits, including a catch-up limit.
-
By 2026, if your 2025 income exceeds $145,000, you will be forced to take a Roth-style catch-up approach.
-
Even though your money loses the upfront tax break, there are huge benefits to catching up on your 401(k) plan in new ways, if necessary.
-
The $23,760 Social Security Bonus Most Retirees Completely Overlook ›
One real benefit of 401(k) plans is that they have significantly higher annual contribution limits than IRAs. This allows you to save a large amount of money for retirement in a tax-advantaged way.
Of course, not everyone can take advantage of a 401(k) plan’s generous limits. For example, if you make only $50,000 a year, you may not be able to hit the 401(k) limit. But as your salary increases, maxing out your 401(k) benefits becomes more feasible.
In 2026, 401(k) rules for high earners will change. If you fall into this category, here’s what you need to know.
Before we discuss the big 401(k) changes for high earners in 2026, let’s review what it might look like to take advantage of one of these workplace plans in the new year.
If you are under age 50, your maximum 401(k) contribution limit in 2026 is $24,500, up from $23,500 in 2025. If you are 50 or older, the new 401(k) catch-up contribution limit for 2026 is $8,000, up from $7,500 in 2025. This means that if you turn 50 next year, your total allowed 401(k) contributions will be $32,500.
However, there is an exception for savers aged between 60 and 63 years. If you fall into this age range, your 2026 401(k) catch-up contribution could be up to $11,250, bringing your total allowable contribution to $35,750.
If you make an average salary and are 50 or older, you probably don’t plan to put up to $32,500 (or, depending on your age, $35,750) into a 401(k) plan in 2026. But if you earn enough to cover the maximum, it’s certainly worth it.
However, you should know that if your income in 2025 exceeds $145,000, you won’t be able to catch up with a traditional 401(k) plan next year. In this case, your only option for catching up is to take a Roth 401(k).
To be clear, though, you can still make a regular contribution of $24,500 to a traditional 401(k). Only the catch-up portion must be included on an after-tax basis.
If you have a higher income, one of the great benefits of saving for retirement through a traditional 401(k), including your catch-up, is that you avoid paying taxes on your income. With a Roth 401(k), you don’t have to. So if you decide to chase a Roth next year, the money will be invested on an after-tax basis.
