A key provision of the SECURE 2.0 Act has taken effect, allowing workers aged 60-63 to make enhanced catch-up contributions of $10,000 annually to their 401(k) plans. The provision aims to help workers in their peak earning years accelerate retirement savings.
The standard catch-up contribution limit for workers 50 and older remains $7,500, but the new "super catch-up" adds $2,500 more for the 60-63 age group. Combined with the standard 2026 contribution limit of $23,500, eligible workers can defer up to $33,500 annually.
For workers in the 24% tax bracket, the full super catch-up contribution reduces federal taxes by $2,400 and grows tax-deferred until retirement. Over a four-year window (ages 60-63), the additional contributions plus investment growth could add $45,000-50,000 to a retirement nest egg.
A notable complication: the super catch-up must be made as Roth contributions for workers earning over $145,000. While this means no immediate tax deduction, the contributions grow tax-free and withdrawals in retirement are tax-free — potentially more valuable for high earners expecting elevated retirement income.
Financial advisors recommend that eligible workers maximize the benefit immediately, as the four-year window is limited and the compounding benefit diminishes with each year of delay. Employers are required to update their plan provisions to accommodate the new limits.
