2026 Retirement Contribution Limits Explained: How Much You Can Really Save This Year

Higher contribution limits for 2026 boost your retirement nest egg. Save more in 401(k)s, IRAs, and other plans. Max out now!

The IRS adjusts limits yearly for inflation. Build tax-free growth-act fast!

Deferral limits rise for 401(k) and 403(b) plans. Catch-ups give older workers extra space.

Stay compliant. Know your eligibility today.

Quick plan tips:

SIMPLE IRAs and 457(b) have unique caps. Employer matches add free cash. Don’t miss free match!
Set payroll deductions now. Income phaseouts hit Roth IRA and traditional deductions.
Check MAGI. Use tables below.

401(k) and Similar Defined Contribution Plans

401(k) deferral hits $23,500 in 2026, up from 2025. Age 50+ adds $8,000 catch-up. Max out now!

Total with matches caps at $70,000 or 100% pay. Update your plan now!

Plan Type	2026 Employee Deferral	Catch-Up (Age 50+)	Total Limit (Employee + Employer)
401(k)/403(b)	$23,500	$8,000	$70,000
Governmental 457(b)	$23,500	$8,000	$70,000
Non-Governmental 457(b)	$23,500	$8,000	Separate from 401(k)

IRA Contribution Limits

IRA limit is $7,000 ($8,000 for 50+). Need earned income to qualify.

Roth has MAGI phaseouts. Traditional deductions phase out with workplace plans.

IRA Type	2026 Limit (Under 50)	Catch-Up (50+)	Key Qualification
Traditional/Roth IRA	$7,000	$1,000	Earned income
SIMPLE IRA	$16,500	$4,000	Small business employee
SEP IRA	25% of compensation	N/A	Self-employed or small biz

Catch-Up Contributions for Older Workers

Ages 60-63 in 401(k) get $11,250 catch-up-beats standard $8,000. Boost near-retirement savings now!

IRA catch-up stays $1,000. Max it to catch up fast.

Total Defined Contribution Limit: $70,000

Combined employee + employer contributions cap at the lesser of $70,000 or 100% compensation in 2026. This includes deferrals, matches, and profit-sharing. Employers have a fiduciary duty to monitor compliance.

For example, on a $50,000 salary, max total is $50,000 since it beats 100% pay. Higher earners hit the $70,000 ceiling first.

Salary	Employee Max	Employer Add-On	Total Limit
$60,000	$23,500	$36,500	$60,000
$80,000	$23,500	$46,500	$70,000
$100,000	$31,000 (50+)	$39,000	$70,000

Track combined totals to prevent excess, which plans refund. HCEs face extra testing, so stay informed. This cap encourages maxing employee deferrals first for the match.

3. 403(b) and 457(b) Plans

403(b) and 457(b) match 401(k) limits. Great for non-profits and government workers. Act before year-end!

Plan Type	2026 Employee Deferral Limit	Key Similarity to 401(k)
401(k)	$23,500	Standard pretax or Roth contributions
403(b)	$23,500	Matches exactly, plus educator catch-up
457(b)	$23,500	No early withdrawal penalty before 59
Thrift Savings Plan (TSP)	$23,500	Federal parallel with similar deferral rules

Employee Contribution Limit: $23,500

Defer up to $23,500 from paycheck. Lowers taxes instantly.

Monthly: ~$1,958. Adjust payroll early!

Months Worked	Monthly Amount	Total Deferred
12	$1,958	$23,500
10	$2,350	$23,500
6	$3,917	$23,500

Catch-Up Contributions for Age 50+

Workers age 50+ add $8,000 catch-up to the $23,500 base, totaling $31,500 elective deferrals. This extra room helps older employees ramp up savings. Plans must allow it by law.

Follow these steps to activate catch-up contributions:

Confirm age with admin.
Update payroll form now.
Check portal monthly.

The Thrift Savings Plan for federal workers runs like these, with the same limits and low-fee funds. It shows how governmental plans align for consistent savings. Talk to your HR about maximizing your contributions.

403(b) Contribution Limits

403(b) mirrors 401(k) at $23,500 employee deferral plus catch-up options for 2026. Non-profit workers, like teachers and hospital staff, use these for steady retirement growth. Pretax dollars lower your taxable income now.

Long-term educators get a 15-year service catch-up, adding up to $3,000 extra if eligible. This helps those loyal to public service catch up on savings. Combine it with standard catch-ups after age 50.

To check eligibility, log into your plan provider portal first. Look for service years and past contributions under account history. Call your administrator if numbers don’t add up, and adjust your payroll deduction right away.

Employers might match up to a certain percent, so aim for the full elective deferral. Review your W-2 each year for compliance. This setup makes big savings feasible without HCE testing hassles.

457(b) Government Plan Differences

457(b) plans for state/local governments allow $23,500 deferrals without early withdrawal penalty before 59. Unlike 401(k) or 403(b), you access funds anytime after leaving the job. This flexibility suits public sector roles.

No 10% penalty on early pulls sets it apart, though income taxes apply. Pair it with a 401(k) or 403(b) for double deferrals up to limits. Governmental employers often offer solid matches.

The Thrift Savings Plan follows similar rules as a federal example. It uses the same $23,500 cap with low-cost index funds. State plans vary, so confirm Roth availability and fiduciary oversight with your plan.

Max out if your budget allows, especially with no age penalty. Update your payroll election during open enrollment. This helps build retirement accounts faster for government workers.

Catch-Up Rules Comparison

All three plans offer standard $7,500 catch-up at 50+, plus SECURE 2.0 super catch-up later. These rules help older workers ramp up savings as retirement nears. Pick the right one based on your age and plan type.

Plan	Standard Catch-Up (Age 50+)	Special Rules
401(k)	$7,500	SECURE 2.0 super catch-up at 60-63
403(b)	$7,500	Plus 15-year service for educators
457(b)	$7,500	Double deferral with other plans possible

For 403(b), that extra service catch-up stacks if you qualify. 457(b) lets you defer the max in another plan too, doubling potential. Age 60-63 triggers higher limits under SECURE 2.0 for all.

Verify your birth year and service in your account dashboard. Increase contributions mid-year if income allows. This boosts traditional or Roth balances effectively.

4. Traditional and Roth IRAs

IRAs cap at $7,000 for 2026, with Roth offering tax-free growth and Traditional providing upfront deductions. You can split contributions between both types as long as the total stays under the limit. This setup fits well into broader retirement savings plans alongside 401k options.

Roth IRAs shine for long-term growth since qualified withdrawals skip taxes entirely. Traditional IRAs give you a deduction now, lowering your taxable income that year. Pick based on your current tax bracket and future expectations.

A smart move involves post-tax Roth conversions as a bridge strategy. Contribute to a Traditional IRA, then convert to Roth later when rates might favor you. This blends upfront savings with eventual tax-free benefits.

Both IRA types require earned income to contribute, like wages or gig work. Max out early in the year to let money compound longer. Track everything to stay within 2026 contribution limits.

IRA Contribution Limit: $7,000

Contribute up to $7,000 total across Traditional and Roth IRAs if under phase-out ranges. This applies whether you use one account or split between both. It works alongside employer plans like 401k or SIMPLE IRA deferrals.

Break it down to $583 per month for steady saving. Set up automatic transfers from your checking account to your brokerage. Gig income fully qualifies as long as it’s reported on your taxes.

You need earned income at least equal to your contributions. For example, a freelancer earning $50,000 can max out easily. Combine with 401k contributions up to $24,500 for total retirement firepower.

Start small if $7,000 feels big, then ramp up. Use payroll deductions where possible for compliance. This keeps your IRA savings on track through 2026 inflation adjustments.

Catch-Up for Age 50+: $1,000

Age 50+ boosts IRA total to $8,000 with simple $1,000 add-on. This catch-up provision helps older workers pad retirement accounts faster. It stacks on top of the base $7,000 limit for Traditional or Roth.

Fund it easily via bank transfer to your brokerage. Many platforms let you schedule one-time or recurring deposits. Add the extra amount early to get the most compound growth time.

Track progress with tools like the Principal.com calculator. Enter your age, income, and contributions to see projections. This confirms you’re hitting 2026 catch-up limits correctly.

If you’re over 50 and close to the limits on government thrift plans or 401k contributions like $24,500 plus the $7,500 catch-up, add this IRA option. It makes bigger savings feasible without HCE restrictions.

Income Phase-Out Ranges

Higher MAGI reduces Roth contributions and Traditional deductions starting at moderate income levels. Phase-outs apply based on filing status and limit full benefits gradually. Partial contributions remain allowed in these ranges.

Use this table for exact 2026 IRS phase-out ranges. It covers Roth direct contributions and Traditional IRA deductions clearly.

filing status	Roth IRA Phase-Out	Traditional IRA Deduction Phase-Out
Single or Head of Household	$150,000 – $165,000	$83,000 – $103,000
Married Filing Jointly	$236,000 – $246,000	$133,000 – $153,000
Married Filing Separately	$0 – $10,000	$0 – $10,000

Check your MAGI each year, as it includes taxable compensation minus certain deductions. If in phase-out, calculate prorated amounts for accuracy. Roth conversions bypass these limits post-contribution.

For example, a joint filer at $240,000 MAGI might contribute half to Roth. Always verify with tax software for your situation. This keeps IRA options open amid rising incomes.

5. SIMPLE IRA and SEP-IRA Limits

Small businesses favor SIMPLE IRAs and SEP-IRAs for easy setup and higher employer contributions in 2026. These plans suit companies with fewer employees who want straightforward retirement options. They avoid the complexity of 401k plans while boosting savings through employer matches or contributions.

SIMPLE IRAs require HCE testing to stop highly paid employees from going over limits in an unfair way. This keeps compliance simple for small firms. Check Saxon Financial Group for setup guides that walk through the process step by step.

SEP-IRAs shine for solo owners or businesses needing flexibility on contribution timing. Employers can fund them up to tax filing deadlines. Both plans adjust for inflation each year, making 2026 limits more generous than 2025 figures.

These IRAs fit traditional or Roth structures in some cases, helping employees build retirement accounts with elective deferrals or direct employer inputs. They offer feasible options for thrift savings plans without fiduciary headaches common in larger 401k setups.

SIMPLE IRA Employee: $16,500

SIMPLE IRA allows $16,500 employee deferrals via payroll deduction in 2026. This matches 401k deferral levels but skips the match requirements of bigger plans. Employees elect contributions directly from paychecks for steady retirement savings.

Employers must implement via

choosing a plan year start,
notifying employees 60 days before,
setting up payroll deduction systems.

This keeps things simple for small teams. Unlike 401k matches, SIMPLE requires either a 2% nonelective or 3% matching contribution.

Compare to 401k: SIMPLE caps employee input at $16,500 under 50, but employer adds make totals competitive. It’s ideal for governmental or small business savings plans. Use this to increase your 2026 retirement savings without high admin costs.

Practical tip: Track deferrals monthly to stay under limits. This setup helps older workers nearing retirement max out contributions easily.

SIMPLE IRA Catch-Up: $3,500

Age 50+ adds $3,500 catch-up to SIMPLE IRA, higher than standard IRA catch-up amounts. This brings total employee deferrals to $20,000 for those 50 and older in 2026. It gives a nice lift for late starters building retirement accounts.

Note no employer match applies to catch-up portions, unlike base deferrals. Employers still provide the required 2-3% on regular contributions. Total example: a 55-year-old deferring $16,500 plus $3,500 reaches $20,000 from employee side alone.

This exceeds 2025 catch-up by inflation adjustments, aiding older workers. Combine with employer inputs for substantial annual savings. SIMPLE’s structure makes catch-ups straightforward via payroll.

Actionable advice: If over 50, prioritize this to accelerate retirement goals. It pairs well with other IRAs for diversified savings plans.

SEP-IRA Employer Maximum: 25% of Compensation

Employers contribute up to 25% of each employee’s compensation to SEP-IRAs, no employee deferrals allowed. This one-sided funding simplifies admin for businesses. Caps apply overall, like 2026’s high limits mirroring 401k maximums.

Example: $100k pay equals $25k contribution maximum. Employers must use uniform percentage across all eligible employees for compliance. Deadline stretches to tax filing, even with extensions, offering flexibility over payroll-tied plans.

Unlike SIMPLE, no HCE testing burdens here, but proportionality rules apply. Great for super contributions in profitable years. Ties into income-based limits without phaseouts like Roth IRAs.

Tip: Calculate based on W-2 wages for accuracy. This plan secures employer-driven retirement boosts, perfect for traditional IRA rollovers later.

6. Special Catch-Up Rules for Ages 60-63

SECURE 2.0 introduces super catch-up for ages 60-63, nearly doubling standard amounts. This change starts in 2026 and helps late-career savers build larger retirement funds. Employers must adopt these rules in their 401(k) plans for you to use them.

Imagine you are in your early 60s, realizing past years slipped by without maxing contributions. These higher limits let you add more to your traditional or Roth 401(k) accounts. It’s a practical way to catch up on savings before retirement hits.

Total deferrals could reach $34,750 for eligible workers, combining base limits with super catch-up. Check your plan documents or talk to HR to confirm availability. This applies to elective deferrals through payroll deductions.

Governmental and thrift savings plans may also qualify if they update for compliance. Late starters often find this age-based boost makes bigger savings feasible. Verify your employer’s adoption to avoid surprises come 2026.

New SECURE 2.0 Super Catch-Up

Ages 60-63 qualify for enhanced catch-ups under SECURE 2.0 starting 2026. This super catch-up helps recoup missed savings years in your 401(k) or similar plans. It’s designed for older employees nearing retirement.

Standard catch-up is $7,500 in 2025, but this jumps higher for the 60-63 group. You can stack it on the $23,500 base deferral limit, pushing totals way up. Many see it as a final push for retirement security.

Check your plan documents for opt-in details, as not every employer jumps on board right away. Contact your administrator to learn about timelines. This rule helps people with irregular saving records.

For example, a 62-year-old maxing contributions could add thousands more yearly. It works for both traditional and Roth options, depending on your tax setup. Plan ahead to make the most of this window.

401(k) Enhanced Limit: $11,250

401(k) super catch-up reaches $11,250 for 60-63, plus $23,500 base. That brings your total employee deferrals to $34,750 in 2026, adjusted for inflation each year. It’s a solid increase over prior limits.

Update your payroll elections through your ADP portal or HR system to hit this max. Start by reviewing current withholdings and bumping them up. Employers handle the rest via automatic deductions.

Matches from your employer can add even more, but they don’t count toward deferral caps. Focus on your elective deferrals first to claim the full super catch-up. This setup benefits high earners close to retirement age.

If you’re a highly compensated employee (HCE), watch for nondiscrimination testing that might limit contributions. Talk to your plan fiduciary about feasibility. Many find this increase changes how their savings grow.

Eligibility and Plan Requirements

Plans must amend by 2026 deadline; not automatic despite SECURE 2.0 mandate. Your employer decides on adoption for 401(k), SIMPLE, or governmental plans. Reach out to HR or the plan administrator soon.

Ask these key questions to confirm:

Has our plan adopted the super catch-up for ages 60-63?
What are the exact 2026 contribution limits including this boost?
Do Roth and traditional options both qualify?
Any impact on HCEs or testing rules?

Expect updates via email or portals by late 2025. If your plan lags, contributions default to standard catch-up amounts. This preparation makes sure you get the bigger savings.

Solo 401(k) owners can set this up easily. Follow IRS rules and track age and elections for compliance. Grab that extra retirement boost now!

7. Combined Contribution Strategies

Stack 401(k) + IRA + spousal contributions to beat single-plan limits legally. Stay under 2026 retirement caps with smart coordination.

Grab employer matches first in your 401(k). Add IRA contributions. Spouses can join using your income for a household savings surge.

Track all contributions to dodge overages. Use logins or spreadsheets for 401(k), IRA, and spousal amounts. Review mid-year for catch-up options.

Max 2026 elective deferrals first. Then hit traditional or Roth IRAs for tax diversity and bigger growth.

Maxing Multiple Plans Legally

Combine 401(k) + governmental 457(b) + IRA. No shared deferral limits mean higher 2026 totals. Stack savings freely!

Scenario	Total Possible
Single 401(k) only	Standard deferral limit
401(k) + governmental 457(b)	Double deferral limits
401(k) + 457(b) + IRA	Double deferrals + IRA max

Track like this:

Log into payroll portals quarterly.
Separate elective deferrals from matches and thrift savings.

Governmental 457(b) fits public workers. It skips HCE testing (highly compensated employee rules). Pair with SIMPLE if self-employed; older workers love the catch-up boost.

401(k) + IRA Coordination

Max 401(k) for matches first. They give free cash! Add IRA for Roth or traditional flexibility in 2026.

Employer plans cut IRA deductibility. High income phases out traditional deductions. Check MAGI (modified adjusted gross income) vs. 2026 ranges for Roth.

Confirm 401(k) contributions hit the maximum, like $24500 deferral.
Add IRA up to $7500 or catchup if age 50+.
Review tax forms for deduction impacts from employer plan coverage.
Adjust if needed for income limits on Roth contributions.

This grabs matches and diversifies. It works for all filing statuses with yearly inflation tweaks.

Spousal Contribution Opportunities

Spousal IRA lets non-workers contribute using your income. Double household IRAs in 2026. Perfect for stay-at-home parents!

File jointly for max benefits. Both hit full IRA limits from your pay. Pick traditional or Roth by income rules.

Verify your income covers both IRAs.
Choose Roth for tax-free growth if feasible.
Watch phaseouts for higher earners.
Contribute by tax deadline for prior year if missed.

Pair with 401(k) for huge savings. Couples: retire stronger together, stay compliant easily!

8. Income Limits and Phase-Outs

Phase-outs block high earners from Roth contributions and traditional deductions. They base on MAGI and filing status. See IRS Pub 590-A for yearly ranges.

2026 IRA limits rise with inflation. High MAGI cuts direct Roth or traditional deductions. High earners, plan around it!

A popular workaround for those above the limits is the backdoor Roth IRA. You make a nondeductible contribution to a Traditional IRA, then convert it to Roth. This strategy helps bypass phase-outs while building tax-free growth.

Calc MAGI right, add tax-exempt interest. 401(k)s have no income limits for deferrals. Pair with IRAs for 2026 max savings!

Roth IRA Direct Contribution Ranges

2026 Roth phase-outs: Singles start at $150,000 MAGI, full at $165,000. Joint filers: $236,000 to $246,000.

Filing Status	Phase-Out Start (MAGI)	Full Phase-Out (MAGI)
Single or Head of Household	$150,000	$165,000
Married Filing Jointly	$236,000	$246,000
Married Filing Separately	$0	$10,000

Phase-out range? Get partial credit. Singles at $157,500 MAGI contribute half of $7,000 max.

Ranges rise yearly with inflation. Over limit? Use backdoor Roth: nondeductible traditional to Roth conversion.

Traditional IRA Deduction Limits

Employer plan users face traditional IRA phase-outs. 401(k) coverage triggers them by MAGI. Check IRS Pub 590-A for 2026 tables.

Filing Status	Phase-Out Start (MAGI)	Full Phase-Out (MAGI)
Single or Head of Household	$81,000	$101,000
Married Filing Jointly (covered)	$129,000	$153,000
Married Filing Jointly (non-covered spouse)	$240,000	$290,000

Deductions fade in phase-out. Full phase-out: nondeductible. Still contribute $7,000 + $1,000 catch-up at 50+.

Nondeductible IRAs set up Roth conversions. Pair with 401(k) for $24,500 deferrals, no income limits. Balance your 2026 strategy!

9. Self-Employed and Gig Worker Options

Gig workers and owners: grab Solo 401(k)s. Easier setup than group plans, no payroll hassle.

Mix employee + employer contributions for higher 2026 totals. Beats standard IRA or 401(k) limits easily.

Match plans to income and age. Solo 401(k) rocks for under-50s with steady cash. Add catch-up over 50.

Fund by Dec 31. Deduct and grow tax-free. Gig flexibility beats jobs!

Solo 401(k) Employee + Employer Limits

Solo 401(k): $23,500 employee deferral + 25% profit share, up to $70,000 in 2026. Roth option too. Ideal for sole props!

Calculate your share step by step. First, take your net business profit after expenses. Then subtract half of self-employment tax to get contribution base.

Net profit minus expenses.
Subtract half self-employment tax for base.

Defer $23,500 employee ($30,500 at 50+). Add 25% base as match. Cap: $70,000 or $77,500.

Setup online fast, like Fidelity guide. Deferrals by Dec 31; employer to tax day. Track income tight.

Defined Benefit Plan Alternatives

Defined benefit plans lock fixed payouts. Enable $200k+ yearly contributions for older owners near retirement.

Actuary designs it by age and goals. Numbers fuel big 2026 deposits. More paperwork than Solo 401(k).

See specialist first. Over 50 with profits? Max savings quick. Add 401(k) for more!

Fees offset by deductions. Funds hit stocks or bonds fast. Catch up if you lagged!

How to Maximize Your Savings

Hit max limits, skip traps. Run personal audit checklist on 401(k), IRA, others. 2026: $24,500 deferrals, $8,000 catch-up (50+), $7,500 SIMPLE.

Add matches, after-tax to $75,000 in 401(k). Spousal IRAs: $8,000 each. Check Roth phase-outs at high MAGI.

457(b) adds $24,500 separate. Secure 2.0 super catch-up: $11,000 at 60-63 if HCE. Lock max savings now!

Worksheet spots thrift or payroll gaps fast.

Step-by-Step Contribution Planning

Review plans: 401(k), IRA, SIMPLE, 457. (30 min)
Monthly deferrals: $24,500 / 12 = ~$2,042 + catch-up + $750 match. (15 min)
Q1 payroll change via HR for max 2026. (1 week)
Fund $8,000 IRA early, mind phase-outs. (20 min/mo)
Check HCE pacing quarterly. (10 min)
Mid-year after-tax to $75,000.
Year-end true-up fixes shortfalls.

Tax Benefits Breakdown

Traditional: defer taxes now. Roth: tax-free qualified withdrawals. Match to tax brackets.

Lower retirement bracket? Traditional cuts taxes today. Higher? Roth for future tax-free.

Plan Type	Tax Now	Tax Later
Traditional 401k/IRA	Deductible	Taxed as income
Roth 401k/IRA	After-tax	Tax-free qualified
SIMPLE IRA	Deductible	Taxed as income
457(b) Governmental	Deductible	Taxed as income

Decision tree: Low income now? Traditional saves more upfront. High earner planning Roth conversions? Mix plans for flexibility.

Common Maximization Mistakes

Overcontribute: 6% tax. HCE test fails: withdraw excess by March 1.

Mistake: Forgetting catch-up limits at age 50. Fix: Add $8,000 or $11,000 Secure 2.0 super for ages 60-63.
Mistake: Missing employer match. Fix: Contribute enough for full $750 or more in 401k plans.
Mistake: Ignoring phaseouts. Fix: Check MAGI for Roth IRA eligibility early in 2026.
Mistake: No mid-year corrections. Fix: Use payroll true-up or correction windows before audits.
Mistake: Coordinating limits wrong. Fix: 457(b) adds separate $24,500, not shared with 401k.

Year-end true-up auto-fixes. Mid-year tweaks help HCEs pass tests.

2026 Retirement Contribution Limits Explained: How Much You Can Really Save This Year