2026 Retirement Plan Contribution Limits

If you’re saving for retirement, you need to pay attention to annual retirement plan contribution limits for two reasons:

1. You want to contribute as much as you can to reach your goals.
2. You don’t want to contribute too much and incur a penalty.

The IRS reviews retirement plan contribution limits each year. For 2026, both workplace plans and IRAs see meaningful increases. The 401(k) employee deferral limit rises to $24,500, and IRA contribution limits increase to $7,500.

Types of Retirement Plans and Who They Apply To

There are many different retirement accounts available to workers, but they all fall into three main categories:

• Employer-sponsored retirement plans
• Individual retirement accounts (IRAs)
• Self-employed or small business retirement plans

Employer-Sponsored Retirement Plans

If you are in the military or work in the civil service, you are likely eligible for the Thrift Savings Plan (TSP). For the most part, the TSP functions like a 401(k) plan, a common civilian-sector retirement plan. Similar plans include the 403(b), which is common in nonprofit sectors, as well as 457 and 401(a) plans.

Employer-sponsored retirement plans allow participating employees to contribute money directly from their paychecks, often before it is taxed. The money grows tax-free until you make qualified withdrawals in retirement, at which point the IRS taxes your withdrawals. Some employer-sponsored plans have a Roth component, in which contributions are made after taxes and qualified withdrawals are tax-exempt.

Individual Retirement Accounts (IRAs)

Individual retirement arrangements (IRAs) are among the best ways to save for retirement, whether you have access to an employer-sponsored plan or not. IRAs have separate contribution limits from employer-sponsored plans, so you can contribute to both.

The two main types are traditional IRAs and Roth IRAs. Traditional IRA contributions are generally tax-deductible if your income falls within certain ranges, and withdrawals are taxed in retirement. The Roth IRA works differently, you contribute with after-tax dollars, your money grows tax-free, and qualified withdrawals are not taxed.

Self-Employed and Small Business Retirement Plans

A variety of retirement plans are available to small business owners and self-employed individuals, including the solo 401(k), simplified employee pension plans (SEP-IRAs), and savings incentive match plans for employees (SIMPLE IRAs). The IRS maintains a full overview of these plans at IRS.gov.

2026 Retirement Plan Contribution Limits

Here are the confirmed limits for the 2026 tax year. These limits are reviewed annually by the IRS.

Employer-Sponsored Plans: 401(k), 403(b), 457, 401(a) and TSP

• Under age 50: $24,500; total maximum contribution including employer matching: $72,000

• Age 50 and older: $32,500 ($24,500 + $8,000 catch-up); total maximum: $80,000

• Ages 60 to 63: $35,750 ($24,500 + $11,250 enhanced catch-up); total maximum: $83,250

All contributions must be made within the calendar year.

Individual Retirement Accounts (IRAs)

• Under age 50: $7,500

• Age 50 and older: $8,600 ($7,500 + $1,100 catch-up)

Traditional and Roth IRAs share a combined contribution limit of $7,500. You can split contributions between both accounts as long as the total does not exceed the limit. You can make IRA contributions for the 2026 tax year anytime between January 1, 2026, and April 15, 2027.

Self-Employed and Small Business Plans

• SIMPLE IRA: $17,000 for those under age 50; $21,000 for those age 50 and older ($17,000 + $4,000 catch-up); ages 60-63 may contribute up to $22,250

• SEP-IRA: The lesser of 25% of compensation or $72,000

• Solo 401(k): Employee deferrals up to $24,500 plus up to 25% of net self-employment earnings; total contributions cannot exceed $72,000 ($83,250 for ages 60-63)

Important 2026 Change: Roth Catch-Up Requirement

Starting January 1, 2026, TSP and 401(k) participants whose prior year income exceeded $150,000 must designate any catch-up contributions as Roth rather than traditional. Your payroll office will handle this automatically if it applies to you.

How to Avoid Exceeding Retirement Plan Contribution Limits

Each retirement plan has specific rules you must follow. Exceeding contribution limits may subject you to penalties or fees from the IRS.

It is also important to note that some plans share contribution limits. For example, the solo 401(k) shares its employee deferral limit with employer-sponsored plans like the 401(k) and TSP. If you are eligible for both, balance your contributions to ensure your total does not exceed the annual maximum.

Balancing Retirement Account Contributions When Working More Than One Job

This is a common situation for military members, particularly those serving in the Guard or Reserves, while also working a civilian job or running a small business. If you have a solo 401(k) through a business and also contribute to the TSP through your Guard or Reserve service, these two plans share the same employee deferral limit of $24,500. You will need to balance your contributions between the two accounts to avoid exceeding the limit and incurring penalties.

One practical approach is to consolidate all contributions into a single account to simplify bookkeeping and reduce the risk of over-contributing. If you are unsure how to balance contributions across multiple plans, consult a fee-only financial planner or tax professional.

Pay Attention to Contribution Limits When Changing Jobs

If you change jobs during the year, a common situation for separating service members, be aware that your new employer’s retirement plan will not have visibility into contributions you already made at a previous employer. Plan ahead by front-loading your contributions early in the year if you know you will be separating from the military or changing jobs mid-year.

Why You Should Maximize Retirement Contributions Now

The best thing you can do for your retirement is to start contributing as early and as consistently as possible. Compound interest rewards those who start early, the more you invest now, the less you have to worry about later.

If current market conditions make you nervous, consider placing your money in a high-yield savings account, money market account, or certificate of deposit until you feel more comfortable investing in equities. Most retirement accounts also offer a cash fund or cash-equivalent option that lets you contribute first and decide where to invest later, removing the biggest barrier to getting started.

If you are not sure where to invest, a target-date fund, similar to the lifecycle funds available in the TSP, automatically diversifies and rebalances your portfolio over time without requiring any additional decisions on your part.

Do not let uncertainty stop you from contributing now. Future you will be grateful.