Every January, the IRS announces new retirement contribution limits. Most people ignore it. But if you're even slightly serious about retirement, these numbers matter — because every dollar you don't contribute is a dollar that could've been growing tax-free for decades.
Here's what's new for 2026 and what to do about it.
| Age | Your Contribution Limit | Catch-Up (50+) | Total |
|---|---|---|---|
| Under 50 | $23,500 | — | $23,500 |
| 50 and up | $23,500 | $7,500 | $31,000 |
That's just your money. Your employer's match doesn't count toward this limit. The combined total cap (you + employer) is $70,000 for 2026, or $77,500 if you're 50+.
Before you worry about maxing out, make sure you're getting your full employer match. This is non-negotiable.
Example: Your employer matches 50% up to 6% of your salary. You earn $80,000. Contribute 6% ($4,800). They add $2,400. You just got a 50% instant return. Find me an investment that beats that.
If you're not contributing enough to get the full match, fix that today. Literally log into your HR portal right now.
More employers now offer a Roth 401k option. Here's the quick version:
| Traditional 401k | Roth 401k | |
|---|---|---|
| Tax break | Now (lowers your taxable income) | Later (tax-free withdrawals) |
| Best if... | You're in a high tax bracket now | You expect to be in a higher bracket later |
| RMDs | Required at 73 | Required at 73 (but can roll to Roth IRA) |
My take? If you're early in your career and in a low tax bracket, Roth is probably the move. If you're peak-earning years and paying 32%+ federal tax, Traditional saves you real money now.
Or split it. Contribute enough to Traditional to drop into a lower bracket, then put the rest in Roth. Tax flexibility in retirement is underrated.
Some 401k plans let you contribute after-tax dollars beyond the $23,500 limit, up to that $70,000 total cap. If your plan also allows in-service Roth conversions, you can effectively dump an extra $30,000+ per year into Roth.
Only about 40% of plans offer this. Check with HR. If yours does, it's one of the most powerful retirement hacks available.
Don't beat yourself up. Most Americans can't max out their 401k. But small increases compound:
See how much your 401k could be worth at retirement based on your salary, match, and contribution rate.
Use the 401k Calculator →No. The $23,500 is only your contributions. Employer match is separate. Combined total can't exceed $70,000.
Contact your plan admin immediately. Excess contributions must be withdrawn by April 15 of the following year or you face a 6% excise tax. Most payroll systems prevent this, but job changes mid-year can cause issues.
Get the employer match first — free money. Then attack high-interest debt (over 7% APR). Low-interest debt can wait while you invest. Exact priority depends on your rates and risk tolerance.