New Year, New Limits: 2026 Retirement Contributions Explained

Retirement contribution limits are higher in 2026—but some new rules come with them. Brendan walks through the key updates in the first Coffee with Waymark of the year.

Find out:

• the new 401(k) contribution limits for 2026

• why ages 60–63 can contribute even more

• how much you can gift tax-free in 2026

• what the new catch-up rules mean for you

  
  

 Hey, thanks for joining me on the first 2026 Coffee with Waymark.

Today we're gonna talk about the changes that have been made to contribution limits for 2026, including 401Ks, gifting and catch-ups for those qualified plans. So let's jump right in. 

So let me share this with you. You'll see that for most individuals, so people under the age of 50, we're looking at contribution limits of now $24,500. So that's an increase over $1,000 since 2025. So now you can contribute 24,500. If you are 50 years or older, but not 60, 61 or 62 or 63, (we'll talk about that in a second, you can add an additional $8,000. Now there is a big change that's happened where if you're making over $150,000, that extra catch-up cannot be put in the traditional side of your 401k. It must go into the Roth side of the 401k. 

Now, there's been a lot of talk about this and ultimately, typically Roth IRAs are a good thing: the money that you put in, you don't get a tax deduction for, but when you take it out, not only is that $8,000 tax free, but any growth on that is tax free. However, it's a little bit of a nuisance because that $8,000 in 2026 will not get a tax deduction like the other $24,500. So again, we can talk about that if you do have a question about it. But long story short, if you're under the age of 50, you can make a contribution of $24,500 to either you traditional 401k or Roth 401k, or a combination of the of two.

If you are making less than $150,000, then you can do the same with the extra $8,000. But if you're making over $150,000, you have a choice on the $24,500, you don't have a choice on the $8,000. That has to go to the Roth 401k side of things. And again it's a good thing in the long term, but not such a good thing from a tax standpoint for tax year 2026.

Moving along to that very specific number of years in the age band, which is 60, 61, 62 & 63, instead of these $8,000 extra contribution you get even a little bit more–$11,250. So that's $11,250 on top of the $24,500. Quick math here, that is a total of $35,750 that you'd be able to put into your 401k, 403B, 457 if you are between the ages of 60 and 63, moving forward. So I'll just leave it there. Again, if you have any questions, feel free to talk to me. Talk to your accountant, talk to your HR department on exactly what that means. 

When it comes to traditional and Roth IRAs, you've got an extra $500 from last year. And with regards to those age 50 or older, again, you get a little bit of a catch-up, so you now can put in a total of $8,600. So $7,500 as the normal under 50-year-old, and then an additional $1,100, which again is a little bit of an increase over last year. This part I won't get too much into. 

And then finally, gifting. A lot of people still say to me, I want to gift $10,000, and that was the gifting limit a while ago. At this point that it's over a decade old that you were able to gift to anyone $10,000 and it didn't appear on your tax return, but now it's up to $19,000. That is not a change from 2025. So that of all of these different things, the only one that hasn't changed is the annual gift exclusion.

You can gift $19,000 to as many people as you want. You could give $19,000 to me. You could give $19,000 to Brandon. You could give $19,000 to Hanifa. I know my compliance department would not like that if you did that. So please don't do that. But just for a hypothetical example, you can give $19,000 to as many people as you want. And then if you are married, both of you, both your husband and wife can contribute $19,000 for a total of $38,000. 

So that's all I got for you. Lots of numbers here. Hopefully that explains things as clearly as it can be. I know there's a few little wrinkles, especially that Roth 401k with the catch-up contributions, and then that $60 plus catch-up–that's just for those few age bands that are mixed in there.

Thanks for joining me, and remember to be well and do good.

Brendan is the Managing Director for Waymark Wealth Management. He has extensive experience in comprehensive wealth management. His focus includes retirement planning, behavioral finance, investment portfolio construction, education funding, insurance & risk management, taxes, charitable giving, and estate planning. Brendan has an ability to take clients' complex visions and distill them down to simple action plans, helping them move from where they are today to where they want to be tomorrow.

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