Retirement, Investments, & Insurance for Individuals Build your knowledge Save extra for retirement with catch-up contributions

Save extra for retirement with catch-up contributions

Catch-up contribution increases for 2024 may help give you flexibility to save more for retirement.

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2 min read |

It’s understandable that your retirement savings may fall short when there are unexpected expenses or competing goals such as owning a home and raising children. Fortunately, there are key planning tools and resources that can help you get to your retirement savings goals.

One key element, if you’re older than age 50: catch-up contributions. Catch-up contributions let you save more, either in your IRA or your organization's retirement plan (if allowed) once you meet the regular contribution limit.

2024 catch-up contribution limits

In 2024, if you’re still working, you can make a maximum annual contribution of $23,500 to your employer’s retirement plan. But if you’re age 50 or older, you may be able to make an additional catch-up contribution of up to $7,500. To be eligible for catch-up contributions in any given year you first must meet the maximum annual contribution IRS limit, or the max for your organization's retirement plan (if it includes a catch-up provision).

Common catch-up contribution limits

401(k)/403(b), most 457 plans
Annual contribution limit $23,000
Catch-up contribution $7,500
Total contribution with catch-up $30,500
Individual retirement account (traditional & Roth)
Annual contribution limit $7,000
Catch-up contribution $1,000
Total contribution with catch-up $8,000
Annual contribution limit $16,000
Catch-up contribution $3,500
Total contribution with catch-up $19,500

Using catch-up contributions to maximize retirement savings

If you're 50 or older, the catch-up provision can provide a great opportunity to contribute more to your retirement savings. This is especially true if you haven't always been able to contribute the maximum amount in the past. The pre-tax contributions also allow you to reduce your current taxable income even further.

Other ways to boost retirement savings

While making catch-up contributions is important, increasing the amount you're saving through a lump sum amount like a catch-up contribution may not always be feasible. Another way? Incremental increases in your contributions—even 1% at a time—throughout the year.

Here’s how that could work. Let’s say you start saving at age 30, putting away 4% from your yearly salary of $30.000. That equals $1,200 in retirement savings that first year. Each year, your salary increases by 3%, and you also increase your retirement savings by 1%. After 11 years, you’re now saving 15% and $6,229 a year for retirement.

Graph showing increase of 1 percent in yearly retirement contributions over a period of 15 years.
Fixed contribution (4%)
Gradually increasing contribution (1% yearly increase)

What’s next?

Log in to to see how much you’re saving each year—and if you might be able to up your contributions. Don’t have an employer-sponsored retirement account? We can help you set up your own retirement savings.