Understanding 401(k) Changes for 2026

As the number of older Americans nearing retirement continues to grow, many are looking for ways to boost their 401(k) savings to combat the rising costs of healthcare and other day-to-day expenses. For 2026, there are key 401(k) changes that investors need to be aware of, according to financial experts. Certified financial planner Joon Um with Secure Tax and Accounting in Hayward, California, notes that “small 401(k) details matter more than ever” this year.

This year, individuals can defer up to $24,500 into their 401(k) plan, an increase from $23,500 in 2025. The full plan limit, which includes employer matches, profit sharing, and other contributions, is $72,000. Additionally, there’s a higher 401(k) catch-up contribution limit for investors aged 50 and older, who can now save an additional $8,000 per year, up from $7,500 in 2025. The “super catch-up” limit for savers aged 60 to 63 remains at $11,250 for 2026.

Individual Retirement Account Contribution Limits

Individual retirement account contribution limits have also increased for 2026, with a new cap of $7,500, up from $7,000 in 2025. Investors aged 50 and older can make a $1,100 catch-up contribution, an increase from $1,000 the previous year. These changes come as many older Americans don’t feel ready for retirement, with over one-third of U.S. adults having delayed or planning to delay retirement due to insufficient savings and inflation, according to a New York Life survey.

Defined contribution plans, such as 401(k)s, are the primary retirement savings tool for many private sector U.S. workers, covering over 100 million participants in 2023, according to a report from the Department of Labor. However, many individuals are not taking full advantage of these plans, with only 14% of participants maxing out their 401(k)s in 2024, and the average combined savings rate, including employer deposits, estimated at 12%, according to Vanguard’s 2025 How America Saves report.

Roth Catch-Up Contributions for Higher Earners

If you’re aged 50 and older, your 401(k) catch-up contributions can be traditional pretax or after-tax Roth, depending on what your plan allows. However, starting in 2026, certain higher earners must make Roth catch-up contributions, based on a Secure 2.0 Act of 2022 change. Neil Krishnaswamy, a CFP and president of Krishna Wealth Planning in McKinney, Texas, notes that in 2026, 401(k) catch-up contributions generally must be Roth if you earned more than $150,000 from the same employer in 2025.

You can determine if this applies to you by reviewing the gross income on your final 2025 paystub. However, the “Roth mandate” doesn’t apply this year if you started a new job on January 1, 2026, or if you exceeded the $150,000 threshold via multiple employers. It’s essential to review your individual circumstances and consult with a financial advisor to understand how these changes affect your retirement savings.

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Smart Tip for Readers

When reviewing your 401(k) plan, consider increasing your contributions, especially if you’re aged 50 or older, to take advantage of the higher catch-up contribution limits and maximize your retirement savings. Regularly reviewing and adjusting your 401(k) contributions can help you stay on track with your retirement goals.