I’m A Financial Planner: 4 Things To Know About 401(k) Changes In 2026

A fig of changes are coming to 401(k) plans successful 2026, including higher publication limits for each relationship holders. The magnitude individuals tin lend to their 401(k) plans volition emergence to $24,500 successful 2026 from $23,500 for 2025, according to the IRS.

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Another change, included successful the Secure 2.0 Act of 2022, targets precocious earners implicit 50 only. This alteration volition person a nonstop interaction connected taxation strategies and take-home wage of those affected. Here are 4 things to cognize astir the 401(k) changes successful 2026, according to a fiscal advisor.

The Secure 2.0 proviso that goes into effect adjacent twelvemonth affects earners implicit the property of 50 who marque yearly incomes of $145,000 oregon more, said Bethany Dever, CFP, Vice President and Relationship Manager at Rockland Trust Investment Management Group. Beginning successful 2026, specified earners are required to marque immoderate catch-up contributions aft taxes to a designated Roth 401(k) account, Charles Schwab noted successful a blog.

So what tin they expect erstwhile the caller regularisation takes effect?

“[It] means paying taxes connected those contributions now, but enjoying tax-free withdrawals successful status for those individuals who autumn nether those 2 requirements,” Dever told GOBankingRates.

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Paying taxes present “could wage off,” Dever said, if you expect aboriginal taxation rates to emergence oregon privation much flexibility successful managing taxable income successful retirement.

Alternatively, if you expect a little income post-retirement, past keeping much pre-tax savings mightiness marque sense. In this case, you should purpose to support portion of your wealth successful different types of accounts.

“A balanced attack — combining accepted and Roth contributions — tin assistance creaseless retired taxation vulnerability crossed some sides of retirement,” said Dever.

The immense bulk of radical implicit 50 don’t marque catch-up contributions connected their 401(k)s, according to a study released earlier this twelvemonth from Vanguard. If you beryllium to that group, determination are steps you tin instrumentality to maximize your status savings.

“Consider expanding your monthly publication to your employer-sponsored status program to the maximum allowed,” Dever advised. “If your leader offers specified a match, marque definite you’re contributing capable wealth to suffice for the afloat magnitude offered. After all, it is escaped wealth that you volition not person if you don’t participate.”