Many Americans worry about whether they are saving enough for retirement. According to the 2025 EBRI/Greenwald Retirement Confidence Survey, 67% of workers said they were very or somewhat confident they would have enough money to live comfortably in retirement, but only 24% said they were very confident.
For those who feel behind, catch-up contributions may offer an important opportunity.
At True North Wealth Management, we help clients understand how retirement savings tools fit into the bigger picture: income planning, taxes, investments, Social Security, estate planning, and long-term financial confidence.
What Are Catch-Up Contributions?
Catch-up contributions allow workers age 50 and older to contribute more to certain retirement accounts than younger workers.
The idea is simple: as retirement gets closer, many people want to increase savings. Some may be entering their highest-earning years. Others may be trying to make up for years when saving was difficult because of raising children, paying off debt, building a business, buying a home, or navigating life changes.
Catch-up contributions can help eligible workers put more money toward retirement during the years when it may matter most.
2026 401(k), 403(b), 457, and TSP Catch-Up Limits
For 2026, the regular employee contribution limit for most 401(k), 403(b), governmental 457 plans, and the federal Thrift Savings Plan is $24,500.
Participants age 50 and older can generally contribute an additional $8,000, bringing the total employee contribution limit to $32,500 for 2026.
Under SECURE 2.0, workers ages 60, 61, 62, and 63 may be eligible for a higher catch-up contribution. For 2026, that higher catch-up limit is $11,250, bringing the total employee contribution limit to $35,750 for those ages, if the plan allows it.
| Age in 2026 | Regular Contribution Limit | Catch-Up Contribution | Total Employee Contribution Limit |
|---|---|---|---|
| Under 50 | $24,500 | Not applicable | $24,500 |
| 50–59 or 64+ | $24,500 | $8,000 | $32,500 |
| 60–63 | $24,500 | $11,250 | $35,750 |
Plan rules can vary, so employees should confirm their specific options with their employer or plan administrator.
Why Catch-Up Contributions Can Matter
An extra contribution may not feel dramatic in a single year, but over time it can make a meaningful difference.
For example, a worker who contributes an additional $8,000 per year during the final decade before retirement may give their retirement account more opportunity to grow. The impact depends on investment performance, fees, market conditions, taxes, and the length of time the money remains invested.
Catch-up contributions can be especially useful for people who:
Started saving later in life
Took time out of the workforce
Had years of reduced income
Paid down debt before focusing on retirement
Recently became empty nesters
Are in peak earning years
Want to reduce current taxable income through pre-tax contributions
Want to build Roth savings, if available through the plan
The best approach depends on your full financial picture.
Traditional or Roth Catch-Up Contributions
Some employer retirement plans allow both traditional pre-tax contributions and Roth after-tax contributions.
Traditional contributions may reduce taxable income in the year they are made, but withdrawals are generally taxed as ordinary income in retirement.
Roth contributions are made with after-tax dollars, but qualified withdrawals may be tax-free if IRS requirements are met.
Choosing between traditional and Roth contributions often depends on your current tax bracket, expected future tax bracket, retirement income strategy, and estate planning goals.
Do Not Forget IRA Catch-Up Contributions
Catch-up contributions are not limited to workplace retirement plans.
For 2026, the IRA contribution limit is $7,500, and individuals age 50 and older can contribute an additional $1,100, for a total of $8,600, assuming they have enough eligible compensation.
IRA deductibility and Roth IRA eligibility may be limited by income, filing status, and participation in an employer retirement plan. For higher-income earners, strategies such as backdoor Roth contributions may be worth discussing with a qualified advisor and tax professional.
Catch-Up Contributions and Retirement Income Planning
Saving more is helpful, but the contribution itself is only one part of the retirement planning process.
As you approach retirement, it is also important to consider:
How much income you may need
When to claim Social Security
How healthcare costs may affect your plan
Whether you have enough emergency savings
How your investments are allocated
Whether you need guaranteed income sources
How taxes may affect retirement withdrawals
When required minimum distributions may begin
Whether your estate plan is current
In most circumstances, required minimum distributions from 401(k)s and similar employer retirement plans begin at age 73. Withdrawals from traditional retirement accounts are generally taxed as ordinary income, and withdrawals before age 59½ may be subject to a 10% federal income tax penalty unless an exception applies.
A Chance to Strengthen Your Plan
Catch-up contributions can be a powerful tool, but they should be coordinated with the rest of your financial life.
Before increasing contributions, consider whether you also need to maintain cash reserves, pay down high-interest debt, manage healthcare costs, support family members, or prepare for a home purchase or other major expense.
The goal is not simply to contribute the maximum. The goal is to contribute the right amount in the right way for your overall plan.
Review Your Retirement Savings Strategy
If you are age 50 or older, catch-up contributions may help you strengthen your retirement outlook. If you are age 60 to 63, the higher catch-up opportunity may be especially worth reviewing.
At True North Wealth Management, we help clients evaluate retirement savings opportunities, tax-aware strategies, investment allocation, and income planning.
If you are wondering whether you are saving enough—or how catch-up contributions could fit into your plan—schedule a conversation with True North Wealth Management.
A thoughtful review can help you understand your options and make more confident decisions as retirement gets closer.
Important Disclosures:
This material is for informational purposes only and is not intended as tax, legal, accounting, or individualized investment advice. Retirement plan rules, contribution limits, tax laws, and eligibility requirements may change. Employer plan features vary. Withdrawals from traditional retirement accounts are generally taxed as ordinary income and may be subject to penalties if taken before age 59½ unless an exception applies. Investment returns and principal values fluctuate with market conditions. Please consult qualified tax, legal, and financial professionals regarding your individual situation.
1. EBRI.org, 2025
2. Economic Growth and Tax Relief Act of 2001
3. IRS.gov, 2025. Catch-up contributions also are allowed for 403(b) and 457 plans. Distributions from 401(k) plans and most other employer-sponsored retirement plans are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty. In most circumstances, you must begin taking required minimum distributions from your 401(k) or other defined contribution plan in the year you turn 73.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite and customized by True North Wealth Management LLC to provide information on a topic that may be of interest. FMG Suite is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright FMG Suite.