The IRS has released the updated retirement plan contribution limits for 2026, effective January 1, 2026. These annual cost-of-living adjustments give taxpayers the opportunity to increase retirement contributions and strengthen long-term financial planning. Below are the most important changes to consider as you prepare for the upcoming year.
401(k), 403(b), and Most 457 Plans
The employee contribution limit for 401(k), 403(b), and most 457 plans will increase to $24,500 in 2026 (up from $23,500 in 2025).
While a $1,000 bump may appear modest, it still provides:
More tax-advantaged space to save
Additional room to build long-term retirement security
Catch-Up Contributions (Age 50 and Over)
For individuals aged 50 and older, the catch-up contribution limit increases to $8,000, allowing a total contribution of $32,500 to a 401(k), 403(b), or 457 plan in 2026.
Special Catch-Up Rule for Ages 60–63
Under the SECURE 2.0 Act, individuals aged 60, 61, 62, and 63 get an even higher catch-up amount:
$11,250 in 2026 (instead of $8,000)
Designed to maximize savings during peak earning years
IRA Contribution Limits
The annual IRA contribution limit will rise to $7,500 in 2026. IRAs remain a strong tool for building tax-deferred or tax-free (Roth) retirement savings outside of employer plans.
IRA Catch-Up Contributions
Individuals aged 50 and over may contribute an additional $1,100, bringing their total IRA limit for 2026 to $8,600.
This long-standing catch-up allowance is especially beneficial for taxpayers looking to accelerate savings in the years leading up to retirement.
Higher Income Limits for the Saver’s Credit
The IRS has raised the income thresholds for the Saver’s Credit, helping more low- and moderate-income taxpayers qualify for this valuable retirement incentive. These expanded limits may increase eligibility and make retirement savings more accessible.
What These Changes Mean for You
The 2026 updates show the IRS’s continued commitment to ensuring retirement savings options keep pace with inflation. This means:
Current savers can boost contributions and take advantage of increased limits.
New or returning savers may benefit from expanded credits and catch-up provisions.
Now is an excellent time to review and adjust your retirement strategy ahead of the new limits.
If you’d like help evaluating your retirement plan or maximizing contribution opportunities, please call us at (401) 921-2000 or contact us here.