Retirement
beginner · $0 - $50K
Most employers match 50-100% of your contributions up to a percentage of salary.
A 4% match on a $75K salary = $3,000/year in employer contributions on top of what you put in.
Not contributing enough to get the match forgoes that portion of your compensation.
Important for 2026: Under SECURE 2.0, employees who earned over $150,000 in FICA wages the prior year must make catch-up contributions as Roth (after-tax) rather than pre-tax.
Annual Limit
$24,500 employee contribution (2026), +$8,000 catch-up (50+), +$11,250 super catch-up (60-63)
Tax Benefit
Tax-deferred contributions plus an employer match
Requirements
- Employer offers 401(k) with matching
- Meet employment eligibility (often 90 days to 1 year)
- NEW 2026: If you earned over $150,000 in FICA wages last year, catch-up contributions MUST be Roth (SECURE 2.0)
How to Implement
- 1Check your employer's matching policy (HR or benefits portal)
- 2Contribute at least enough to get the full match
- 3Select low-cost index funds or target date fund
- 4Increase contribution by 1% each year
Frequently Asked Questions
Understanding IRA Types: Employer vs Individual
Many people don't realize you can contribute to BOTH a workplace retirement plan AND an individual IRA. That's up to $32,000/year in tax-advantaged savings!
| Account Type | Contribution | Through | 2026 Limit | Catch-up |
|---|---|---|---|---|
Employer 401(k) | Pre-tax | Employer | $24,500 | +$8,000 (50+) +$11,250 (60-63) |
Roth 401(k) | After-tax | Employer | $24,500 | +$8,000 (50+) +$11,250 (60-63) |
Traditional IRA | Pre-tax | Individual | $7,500 | +$1,100 (50+) |
Roth IRA | After-tax | Individual | $7,500 | +$1,100 (50+) |
The limits are separate - a 401(k) and an IRA can be funded in the same year
If you have access to a 401(k) at work, you can still contribute to a Traditional or Roth IRA on your own. Combined, that's $32,000 in annual tax-advantaged contributions (before catch-up).
High Earner? You Have Options!
If your income exceeds Roth IRA limits ($168,000 single / $252,000 married):
- Backdoor Roth IRA - Contribute to Traditional IRA, then convert to Roth
- Mega Backdoor Roth - Add up to $47,500+ more via after-tax 401(k)
Related retirement strategies
Sources
- Internal Revenue Service, Rev. Proc. 2025-32
2026 inflation-adjusted amounts (tax brackets, standard deduction, estate & gift, FSA, credits)
- Internal Revenue Service, Notice 2025-67
2026 retirement plan limits (401(k), IRA, SIMPLE, catch-up)
- Internal Revenue Service, Rev. Proc. 2025-19
2026 HSA and HDHP inflation-adjusted limits
Educational information only. Not financial, tax, or legal advice or a recommendation. Figures are drawn from the primary sources cited above; verify current amounts with the source before acting.