The Internal Revenue Service has handed American workers a valuable gift for the new year: substantially higher contribution limits for retirement accounts in 2026. The changes, announced in Notice 2025-67, represent the latest inflation-adjusted increases designed to help workers build more substantial nest eggs.

The New 401(k) Landscape

For employees participating in 401(k), 403(b), and most 457 plans, the annual contribution limit rises to $24,500—up $1,000 from the 2025 limit of $23,500. This represents the largest dollar increase in contribution limits since the $2,000 jump implemented in 2023.

The catch-up contribution limit for workers aged 50 and over also gets a boost, climbing to $8,000 from $7,500. This means older workers can now sock away up to $32,500 annually in their workplace retirement accounts.

"These increases are particularly meaningful given that inflation has eroded purchasing power over the past few years. Workers who can max out their contributions are essentially getting a raise in their retirement savings potential."

— Sarah Chen, CFP, Retirement Planning Director at Vanguard Personal Advisor Services

The SECURE 2.0 Super Catch-Up

Perhaps the most generous provision comes from the SECURE 2.0 Act's "super catch-up" contribution for workers aged 60 through 63. These individuals can contribute an additional $11,250 on top of the standard limit—bringing their total potential contribution to $35,750 for 2026.

This provision was specifically designed to help workers in their early 60s who may be playing catch-up after years of lower earnings or career interruptions. Financial planners are calling it one of the most generous retirement savings opportunities in history.

Key 2026 Contribution Limits

  • Standard 401(k) contribution: $24,500
  • Catch-up (age 50+): $8,000 additional ($32,500 total)
  • Super catch-up (ages 60-63): $11,250 additional ($35,750 total)
  • SIMPLE IRA: $17,000 (up from $16,500)

IRA Limits Also Rise

Individual Retirement Account contribution limits are also climbing for 2026. The annual IRA limit increases to $7,500, up from $7,000 in 2025. This is the first increase in the base IRA limit in two years.

The IRA catch-up contribution for those 50 and older rises to $1,100 from $1,000—a change mandated by SECURE 2.0's cost-of-living adjustment provisions. Combined, savers over 50 can now contribute up to $8,600 to their IRAs annually.

Roth IRA Income Limits Expand

The income phase-out ranges for Roth IRA contributions have also been adjusted upward, allowing more Americans to contribute directly to these tax-free growth accounts:

  • Single filers: Phase-out begins at $153,000 and ends at $168,000 (up from $150,000-$165,000)
  • Married filing jointly: Phase-out begins at $242,000 and ends at $252,000 (up from $236,000-$246,000)

The Mandatory Roth Catch-Up Wrinkle

There's one important caveat for high earners to consider. Under SECURE 2.0 provisions taking effect in 2026, workers earning more than $150,000 who want to make catch-up contributions must direct those funds to a Roth account, not a traditional pre-tax account.

If your employer's plan doesn't offer a Roth 401(k) option, you may be locked out of catch-up contributions entirely. The IRS has given plan administrators extra time to implement this requirement, but workers should verify their plan's Roth availability.

Making the Most of Higher Limits

Financial advisors recommend several strategies for taking advantage of the increased contribution room:

  • Front-load contributions: If cash flow allows, maximize contributions early in the year to benefit from more time in the market
  • Capture the full employer match: Ensure contribution timing doesn't cause you to miss out on matching funds
  • Consider Roth conversions: Higher income limits create more opportunity for tax-free growth
  • Coordinate with HSA contributions: Health Savings Account limits also rose to $4,400 for individuals and $8,750 for families

The Bigger Picture

These increases come at a time when retirement security remains a pressing concern for millions of Americans. According to the Federal Reserve's most recent Survey of Consumer Finances, the median retirement account balance for households nearing retirement age stands at just $134,000—far below what most financial planners recommend.

The higher limits won't solve America's retirement savings crisis, but for workers with the financial capacity to maximize their contributions, they represent a meaningful opportunity to build wealth in a tax-advantaged manner. With compound growth on their side, every additional dollar saved today can translate to significantly more retirement income tomorrow.

For most Americans, the simple act of saving more—regardless of whether they can hit the maximum—remains the most powerful lever for retirement security. The IRS has now given them a bit more room to pull that lever.