What are we catching up on you ask? Your 401K…especially for older guys like me over 50…or you REALLY old guys between 60 and 63. Here is some things to think about:
For 2025, individuals age 50 and older can make an extra $7,500 in 401(k) catch-up contributions. A higher limit of $11,250 applies to those ages 60 through 63. These contributions are on top of the standard 2025 employee contribution limit of $23,500.
Key Rules for 401(k) Catch-Up Contributions
- Eligibility: You must be age 50 or older by the end of the calendar year to be eligible for the standard catch-up contribution. Participants ages 60 through 63 are eligible for a higher “super” catch-up amount.
- Plan Permitted: The catch-up contribution feature must be expressly offered within your employer’s 401(k) plan document. Check with your plan administrator to confirm your plan allows them.
- Contribution Method: Catch-up contributions are made as additional elective deferrals, automatically “spilling over” once the regular annual limit is reached, or through a separate election, depending on your plan’s setup.
- Tax Treatment (2025): For 2025, you can generally choose to make catch-up contributions on either a pre-tax (traditional) or after-tax (Roth) basis, if your plan offers both options.
- Total Limits: The total amount you can contribute (regular plus catch-up) to a 401(k) in 2025 is:
- Ages 50-59 (and age 64+): $23,500 (regular) + $7,500 (catch-up) = $31,000
- Ages 60-63: $23,500 (regular) + $11,250 (catch-up) = $34,750
- Employer Contributions: Employer matching or profit-sharing contributions do not count against your personal elective deferral or catch-up limits.
Coming Change for High Earners (Effective 2026)
Starting in 2026, participants who earned more than $145,000 in FICA wages in the preceding calendar year will be required to make their catch-up contributions on an after-tax Roth basis. If your employer’s plan does not offer a Roth option, high earners will not be permitted to make catch-up contributions at all.
For the remainder of 2025, all eligible participants can still choose between pre-tax and Roth catch-up contributions, regardless of income, provided their plan allows for both.
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