Catch-Up Contributions for Retirement Plans

Catch-Up Contributions for Retirement Plans

Catch-Up Contributions refer to additional contributions that individuals age 50 or older can make to their retirement savings accounts, beyond the standard contribution limits set by the IRS.

These contributions are designed to help older workers accelerate their savings as they approach retirement, allowing them to "catch up" on their retirement funding. For example, in 2023, individuals can contribute an extra $7,500 to their 401(k) or similar qualified plan, in addition to the standard contribution limit of $22,500. This provision is also applicable to other retirement accounts, such as IRAs, where individuals can contribute an additional $1,000 on top of the regular limit.