401(k) and IRA Contribution Limits for 2026: Complete Guide

The IRS just raised 401(k) contribution limits to $24,500 for 2026. That's $1,000 more than 2025.

If you're maxing out your retirement accounts, you can now save an extra $83 per month. Sounds small until you realize that's $30,000 more in retirement over 30 years (assuming 7% returns).

Key Takeaways

• 401(k) limit: $24,500 (up from $23,500 in 2025)
• IRA limit: $7,500 (up from $7,000 in 2025)
• Catch-up contributions (50+): $8,000 for 401(k), $1,100 for IRA
• Super catch-up (60-63): $11,250 for 401(k) under SECURE 2.0
• Roth IRA phase-out: $153,000-$168,000 for single filers

Table of Contents

1. 2026 Contribution Limits Overview
2. 401(k), 403(b), and 457 Plan Limits
3. IRA and Roth IRA Limits
4. Catch-Up Contribution Rules
5. Income Phase-Out Ranges
6. SIMPLE IRA and SEP IRA Limits
7. How to Maximize Your Contributions
8. Frequently Asked Questions
9. Test Your Knowledge
10. The Bottom Line

2026 Contribution Limits Overview

Every year, the IRS adjusts retirement account contribution limits based on inflation. For 2026, we're seeing modest increases across the board.

Here's what changed:

Workplace Retirement Plans (401(k), 403(b), 457):

• 2025 limit: $23,500
• 2026 limit: $24,500
• Increase: $1,000 (4.3%)

Individual Retirement Accounts (Traditional and Roth):

• 2025 limit: $7,000
• 2026 limit: $7,500
• Increase: $500 (7.1%)

The IRA increase is particularly notable. It's the second consecutive year with a $500 bump (the limit was $6,500 in 2023).

Why does this matter? If you were already planning to max out your accounts in 2026, you need to increase your payroll deductions. Otherwise, you're leaving tax-advantaged space on the table.

Let's break down each account type.

401(k), 403(b), and 457 Plan Limits

The $24,500 limit applies to three types of employer-sponsored retirement plans:

• 401(k): Private sector employees (tech, finance, retail)
• 403(b): Nonprofit and education workers (teachers, hospital staff)
• 457: Government employees (federal, state, local)

All three plans work similarly. You contribute pre-tax dollars from your paycheck, and your employer might match a percentage.

Example: You're 28, earning $90,000 at a tech company. You decide to max out your 401(k) in 2026.

• Annual contribution: $24,500
• Monthly contribution: $2,042
• Per-paycheck (biweekly): $942

Your employer offers a 4% match, adding another $3,600 to your account. Total annual savings: $28,100.

Important: The $24,500 limit only applies to your contributions. Employer matches don't count toward this cap. The combined limit (employee + employer) is $70,000 for 2026 (up from $69,000 in 2025).

Roth 401(k) vs. Traditional 401(k)

Many employers now offer a Roth 401(k) option. Same $24,500 limit, but contributions are after-tax (withdrawals in retirement are tax-free).

Which should you choose?

• Traditional 401(k): Better if you're in a high tax bracket now and expect to be in a lower bracket in retirement
• Roth 401(k): Better if you're young, in a lower bracket now, and expect higher income later

You can also split contributions between both. Just make sure the total doesn't exceed $24,500.

Read more: Traditional vs Roth 401(k): Complete Comparison Guide

IRA and Roth IRA Limits

The $7,500 limit applies to both traditional IRAs and Roth IRAs. You can contribute to one or both, but the combined total can't exceed $7,500.

Traditional IRA:

• Contributions may be tax-deductible (depends on income and whether you have a workplace plan)
• Withdrawals in retirement are taxed as ordinary income
• Required Minimum Distributions (RMDs) start at age 73

Roth IRA:

• Contributions are after-tax (no upfront deduction)
• Withdrawals in retirement are tax-free
• No RMDs during your lifetime
• Can withdraw contributions (not earnings) anytime penalty-free

Who Should Use Which?

Choose traditional IRA if:

• You're in a high tax bracket now (24%+)
• You expect lower income in retirement
• You need the upfront tax deduction

Choose Roth IRA if:

• You're in a lower tax bracket (12% or 22%)
• You're young (decades of tax-free growth ahead)
• You want flexibility (no RMDs, early contribution withdrawals)

Most tech workers in their 20s and early 30s benefit more from Roth. You're likely in the 22-24% bracket now, but could be in the 32%+ bracket later. Pay taxes now while they're relatively low.

Read more: 401(k) vs Roth IRA: Which Should You Choose?

Catch-Up Contribution Rules

If you're 50 or older, you can contribute extra to retirement accounts. Think of it as the IRS giving you a second chance to save.

401(k) Catch-Up Contributions

Standard catch-up (50+): $8,000

This means workers 50+ can contribute up to $32,500 total to their 401(k) in 2026 ($24,500 + $8,000).

Super catch-up (60-63): $11,250

Under the SECURE 2.0 Act, there's a new higher catch-up limit for workers aged 60-63. This is huge if you're a late saver.

• Total contribution for ages 60-63: $35,750 ($24,500 + $11,250)
• Total contribution for ages 50-59 or 64+: $32,500 ($24,500 + $8,000)

Example: You're 61, earning $120,000. You maxed out your 401(k) at $35,750 in 2026. Over 4 years (ages 60-63), you saved $143,000 just from your contributions.

Compare that to someone who started at 25 contributing $5,000 per year. By age 63, they contributed $190,000. You're catching up fast.

IRA Catch-Up Contributions

Catch-up (50+): $1,100

Workers 50+ can contribute up to $8,600 total to their IRA in 2026 ($7,500 + $1,100).

The catch-up limit increased by $100 from 2025 ($1,000 to $1,100).

Income Phase-Out Ranges

High earners face restrictions on IRA deductions and Roth IRA eligibility. The IRS uses "phase-out ranges" to gradually reduce benefits as income rises.

Traditional IRA Deduction Limits (2026)

If you (or your spouse) are covered by a workplace retirement plan, your traditional IRA deduction phases out based on income:

Example: You're single, earning $85,000, and you have a 401(k) at work. Your traditional IRA deduction is partially reduced because you're in the $81,000-$91,000 phase-out range.

What to do: If you can't deduct traditional IRA contributions, consider a Roth IRA instead (if you're under the Roth income limits).

Roth IRA Income Limits (2026)

You can't contribute directly to a Roth IRA if your income exceeds these thresholds:

Example: You're single, earning $160,000. You're in the phase-out range, so you can contribute a reduced amount (approximately $4,000 instead of $7,500).

Backdoor Roth workaround: If you earn above the limits, you can contribute to a traditional IRA (non-deductible) and immediately convert it to a Roth. This is legal and commonly used by high earners.

Read more: Backdoor Roth IRA: Step-by-Step Tutorial for 2025

SIMPLE IRA and SEP IRA Limits

Two other retirement account types worth mentioning:

SIMPLE IRA

Common at small businesses (under 100 employees). The 2026 limit is $17,000 (up from $16,500 in 2025).

Catch-up contribution for 50+: $4,000 (up from $3,500)

Total contribution for 50+: $21,000

SEP IRA

For self-employed individuals and small business owners. The 2026 limit is the lesser of:

• 25% of compensation, or
• $70,000 (up from $69,000 in 2025)

SEP IRAs don't have catch-up contributions, but the base limit is much higher than traditional IRAs.

Read more: SEP IRA vs SIMPLE IRA: Which Is Right for You?

How to Maximize Your Contributions

You know the limits. Now here's how to actually hit them.

Step 1: Get Your Employer Match First

If your employer offers a 401(k) match, contribute enough to get the full match before doing anything else. This is free money.

Example: Your employer matches 50% of contributions up to 6% of salary. You earn $80,000.

• You contribute: $4,800 (6% of $80,000)
• Employer contributes: $2,400 (50% of your $4,800)

That's a guaranteed 50% return. No investment beats that.

Step 2: Max Out Your Roth IRA

After getting the full match, prioritize maxing out your Roth IRA ($7,500). Why?

• Tax-free growth
• More investment options than 401(k)
• No RMDs
• Flexibility (withdraw contributions anytime)

Step 3: Go Back and Max Your 401(k)

If you still have money to save, max out your 401(k) ($24,500). This gives you the biggest tax break.

Step 4: Automate Everything

Don't rely on willpower. Set up automatic contributions from your paycheck.

For 401(k): Update your payroll deduction to hit $24,500 by year-end

• Monthly: $2,042
• Biweekly: $942

For Roth IRA: Set up automatic monthly transfers

• Monthly: $625

Most people who try to "contribute when they have extra money" end up contributing nothing. Automate it.

Step 5: Front-Load If Possible

If you have the cash flow, contribute as much as possible early in the year. This maximizes time in the market.

Example: Instead of spreading $24,500 over 12 months ($2,042/month), you contribute $6,125/month for the first 4 months. Your money has 8+ extra months to grow.

Caveat: If your employer match is per-paycheck, don't max out too early or you'll miss out on match dollars later in the year.

Going further: If you're maxing out both your 401(k) and IRA, you might be on the path to early retirement (FIRE). Consider advanced strategies like the mega backdoor Roth if your plan allows after-tax contributions.

Step 6: Track Your Net Worth

Maxing out retirement accounts is great, but you should track your overall net worth to see the full picture.

Why? Retirement accounts are just one piece. You might have equity compensation, crypto, real estate, or taxable brokerage accounts.

Guapital tracks all of these in one place, including your percentile ranking compared to peers. Seeing "Top 18% of 28-year-olds" is way more motivating than staring at a number.

Frequently Asked Questions

Can I contribute to both a 401(k) and an IRA?

Yes. The $24,500 limit applies to your 401(k), and the $7,500 limit applies separately to your IRA. You can contribute the maximum to both in the same year.

However, if you're covered by a workplace retirement plan, your traditional IRA deduction may be reduced or eliminated based on income (see phase-out ranges above).

What happens if I contribute too much?

You'll face a 6% excess contribution penalty for each year the excess remains in your account. If you catch the mistake before filing your tax return, you can withdraw the excess (and any earnings) to avoid the penalty.

Contact your plan administrator immediately if you think you over-contributed.

Do employer 401(k) matches count toward the $24,500 limit?

No. The $24,500 limit applies only to your employee contributions. Employer matches are separate and don't reduce your contribution room.

The combined limit (employee + employer) is $70,000 for 2026.

Can I contribute to a Roth IRA if I have a 401(k)?

Yes, as long as your income is below the Roth IRA phase-out limits ($168,000 for single filers, $246,000 for married filing jointly in 2026).

Having a 401(k) doesn't affect Roth IRA eligibility. It only affects traditional IRA deduction limits.

When is the deadline to contribute to an IRA?

You have until the tax filing deadline (typically April 15) to make IRA contributions for the previous tax year.

Example: You can make 2026 IRA contributions anytime between January 1, 2026, and April 15, 2027.

401(k) contributions must be made by December 31 of the tax year (no extension to April).

Should I do Roth or traditional contributions?

It depends on your current tax bracket and expected retirement income.

Choose Roth if:

• You're in a low tax bracket now (12% or 22%)
• You're young with decades of growth ahead
• You expect higher income in retirement

Choose traditional if:

• You're in a high tax bracket now (24%+)
• You need the upfront tax deduction
• You expect lower income in retirement

Many people split contributions 50/50 to hedge their bets (tax diversification).

What's the difference between 401(k) and 403(b)?

They're almost identical. The main difference is who offers them:

• 401(k): Private sector employers
• 403(b): Nonprofits, schools, hospitals

The contribution limits, tax treatment, and investment options are the same. Some 403(b) plans have slightly higher fees, but that varies by employer.

Self-employed? Check out the Solo 401(k) guide for freelancers which has even higher contribution limits.

Test Your Knowledge

The Bottom Line

The 2026 contribution limit increases give you more room to save for retirement. If you were already maxing out accounts in 2025, you'll need to increase your monthly contributions to hit the new limits.

Here's the quick math:

• 401(k): Increase by $83/month ($1,000/year)
• IRA: Increase by $42/month ($500/year)
• Total: $125/month extra

That might not sound like much, but compounded over 30 years at 7% returns, that's an additional $125,000 in retirement.

The real question isn't whether you can afford to max out your accounts. It's whether you can afford not to.

Want to see where you stand? Track your net worth with Guapital and find out your percentile ranking compared to your peers. When you see "Top 21% of 28-year-olds," you'll know whether you're on track—or need to increase those contributions.

Planning to retire early? Learn about the Roth conversion ladder strategy to access your retirement funds before age 59½ without penalties.