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“Making Money” host Charles Payne discusses 401(k) savings with Walser Wealth Management President Rebecca Walser and what it says about Americans’ retirement.
THE The IRS revealed the contribution limit changes for popular retirement plans, including 401(k) plans and IRAs.
Americans who contribute to 401(k) and 403(b) plans, as well as government 457 plans and the federal Thrift Savings Plan, will see their contribution limits increase to $24,500 in 2026 – an increase from $23,500 in 2025 – the IRS announced in November.
The IRA contribution limit also increases in the new year, from $7,500 in 2026 to $7,000 in 2025.
People aged 50 and over looking to increase their retirement savings through the use of catch-up contributions to IRAs, they will be able to contribute an additional $1,100 to their IRA starting in 2026, up from an additional $1,000 in 2025. This change is due to a provision of the SECURE 2.0 Act requiring an annual cost-of-living adjustment.
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Savers who put money into retirement accounts will generally see higher limits in 2026. (iStock)
For workers aged 50 and over who participate in 401(k)403(b), government 457 plans and the Federal Thrift Savings Plan will see their catch-up contribution limit increased to $8,000 in 2026, an increase from $7,500 in 2025.
This means that workers eligible for catch-up contributions and participating in such plans would see their total contribution limit increase to $32,500 starting in 2026.
A policy change from the SECURE 2.0 Act also created a higher catch-up contribution cap for workers ages 60, 61, 62 and 63 who participate in these plans, with a catch-up cap of $11,250 – up from $8,000 for younger savers – remaining unchanged in 2026.
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The IRS considers updates to contribution limits on an annual basis. (Kayla Bartkowski/Getty Images)
Taxpayers can deduct contributions paid to a traditional IRA in certain circumstances, with the amount of the deduction subject to a phase-out based on income and filing status, as well as whether the taxpayer is covered by a workplace retirement plan.
For single taxpayers covered by an employer-sponsored retirement plan, the phase-out range will increase to between $81,000 and $91,000 in 2026 – an increase from $79,000 to $89,000 in 2025.
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Contribution limits vary depending on the pension schemes a saver uses as well as their income level and tax filing status. (iStock)
For married couples filing jointly, if the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range would increase to between $129,000 and $149,000.
The phase-out range for people contributing to a Roth IRA will amount in 2026 to between $153,000 and $168,000 for singles and heads of household, an increase of $3,000 each compared to this year. For married filers, the phase-out range will be between $242,000 and $252,000 next year, an increase of $6,000 each this year.
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Lisa Featherngill, national director of strategic wealth and business consulting at Comerica Wealth Management, said “the new retirement plan caps for 2026 give people more room to save, which is especially helpful as retirement becomes longer and more expensive.”
