Here’s what we cover in this episode:
🚀 Super Catch-Up Window: A new opportunity for ages 60–63
📈 Higher Contribution Limits: What the increased caps allow
⚖️ Roth vs. Pre-Tax Choices: How tax treatment factors in
🏛️ SECURE 2.0 Impact: What changed for workplace retirement plans
🧩 Personalized Planning: How this rule fits into a bigger strategy
Executive Summary:
Recent changes to retirement plan contribution rules have created a short but powerful planning opportunity for late-career savers. Beginning in 2025, a new “super catch-up” provision allows eligible workers between ages 60 and 63 to contribute meaningfully more to workplace retirement plans than ever before, with additional requirements taking effect in 2026 that influence how those contributions are treated.
When coordinated with income levels, employer plan features, and a long-term tax strategy, this provision can materially improve retirement readiness and lifetime tax efficiency. The opportunity is brief, nuanced, and often misunderstood—but when implemented thoughtfully, it can add flexibility, control, and compounding power to a retirement plan.
Understanding Standard Retirement Contribution Limits
Workplace retirement plans such as 401(k), 403(b), and 457(b) plans are governed by annual contribution limits that apply to employee elective deferrals. For 2026, the base contribution limit is $24,500, regardless of age. Once the saver reaches age 50, an additional catch-up contribution of up to $8,000 is permitted, bringing the total possible contribution to $32,500 under long-standing rules.
These limits are adjusted periodically for inflation but historically offered limited flexibility.
This can be a source of frustration for workers later in their careers. Earnings often peak later in life; expenses may decline as children become financially independent; and mortgage balances are frequently smaller or fully paid off—yet the ability to save more for retirement has been capped.
That dynamic is exactly what the new super catch-up rule was designed to address.
How the Super Catch-Up Rule Works
The super catch-up provision was introduced as part of the SECURE 2.0 Act, passed in late 2022. While the legislation contained many changes to retirement planning rules, several provisions were intentionally delayed. The super catch-up officially took effect on January 1, 2025.
Under the new rules, individuals between the ages of 60 and 63 who are still participating in a workplace retirement plan may contribute an additional $3,250 on top of the standard age 50 catch-up. This increases the total allowable catch-up amount to $11,250.
When combined with the base deferral limit, the maximum total employee contribution for someone in this age window rises to $35,750 in 2026. This represents a meaningful increase in retirement savings capacity during what is often a critical planning window.
Importantly, this is not a loophole or a temporary workaround. It is a deliberate policy change designed to help close late-career savings gaps.
Income Limits and Roth Requirements
Beginning in 2026, an additional rule applies to higher earners. If prior year wages exceeded $145,000, any catch-up contributions—both standard and super catch-up—must be made on a Roth (after-tax) basis. Pre-tax catch-up contributions are no longer permitted above this income threshold.
This change does not eliminate the ability to make catch-up contributions. Rather, it alters their tax treatment. Roth contributions still go into the retirement plan but are not tax-deductible. Future withdrawals from the Roth balance may be tax-free if distribution rules are met.
Those below the income threshold may choose between pre-tax and Roth 401(k) contributions, making tax planning analysis especially important during these years.
Employer Plan Limitations Matter
Not every employer-sponsored retirement plan is required to offer the super catch-up feature. Adoption is optional, and some employers may not have updated plan documents or payroll systems to accommodate the change.
Additionally, super catch-up contributions cannot be redirected to an IRA if the workplace plan does not support them. Eligibility depends entirely on the employer plan’s design, making benefit review a critical step before assuming this strategy is available.
Why This Small Window Can Have a Big Impact
The super catch-up window only lasts four years. Once the saver turns 64, the opportunity disappears. While an extra $3,250 per year may seem modest, its real impact lies in long-term compounding—especially when contributions are made to Roth accounts that grow and distribute tax-free.
Viewed narrowly, the decision may look like a $12,000 opportunity. Viewed over a 20- to 30-year retirement horizon, that same decision can meaningfully influence future income flexibility and tax outcomes.
Beyond dollar amounts, the provision adds planning leverage. Building assets across pre-tax, Roth, and taxable accounts may increase control over future tax brackets and help smooth taxable income throughout retirement.
Integrating the Super Catch-Up Into a Broader Plan
Determining whether to use pre-tax or Roth contributions—when a choice exists—requires analyzing current tax brackets, projected retirement income, and expected future tax rates. The goal is often tax bracket equilibrium: avoiding large swings between low-tax and high-tax years over time.
Starting this analysis earlier rather than later increases its effectiveness. Even those far from retirement benefit from understanding how today’s contribution decisions shape tomorrow’s options.
Final Takeaway
The super catch-up contribution rule offers a rare chance to increase retirement savings and improve tax efficiency during a narrow but critical phase of life. Awareness, verification of eligibility, and thoughtful integration into a broader plan are essential. When used intentionally, this provision can turn a short-lived policy change into a long-lasting retirement advantage.
Authors:
Ryan Wyatt, CFP®, CIMA®
Nick Lewandowski, CFA®, CFP®
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