Only 16% of eligible workers over 50 use 401(k) catch-up provisions, leaving $8,000 in potential retirement savings unused annually.
Nearly all 401(k) plans permit catch-up contributions for workers over 50, yet just 16% of eligible participants take advantage, contributing an average of $0 extra. The 2026 limit rises to $8,000, up from $7,500 in 2024, with workers aged 60-63 eligible for up to $11,250 under SECURE 2.0.
Median full-time earnings stand at $64,000 annually, while average household spending reaches $78,535, leaving little room for additional savings. High earners, already saving 21-23% of salary, dominate catch-up contributions, highlighting a policy gap for lower-income workers.
Data from 4.8 million participants shows the share of eligible workers using catch-up provisions has stagnated for years, despite widespread plan availability.