If you assume your 401(k) works the same way it did a few years ago, you may be missing critical updates.
Quiet changes are reshaping how much you can contribute, how it’s taxed and even whether you’re enrolled at all
Find Out: What a Wealthy Retiree’s Monthly Budget Looks Like at Age 78 Discover More: 10 Clever Ways Retirees Are Earning Up To $1K per Month From Home Retirement experts say many Americans haven’t caught up. Here’s what you need to know: The “Super Catch-Up” Contribution Could Supercharge Late-Career Savings Americans ages 60 to 63 now have access to significantly higher catch-up contribution limits. Brian Finkelstein, the chairman of Broad Financial, said this has “established a promising pathway for those near retirement age to save exponentially.” Account holders between the ages of 60 and 63 can contribute an additional $11,250 to their 401(k), for a total of $83,250 for annual contributions.
What’s more, those who are younger than that, but 50+ years old can also make an extra $8,000 contribution, equating to a total of $80,000. This rule especially benefits people in their peak earning years and self-employed workers nearing retirement. For workers who underfunded retirement in their 40s or 50s, this window may offer a rare chance to close the gap quickly.