← Retirement Planning

2026 IRA Contribution Limits Increase

The IRS recently released the 2026 IRA contribution limits, which have risen from the levels set in 2025. 401(k) contribution limits have increased as well.

Every year, the IRS updates the amount that workers are eligible to contribute to their Individual Retirement Accounts (IRAs) and to their workplace retirement plans. Because these accounts are tax-advantaged, the government puts a limit on how much employees can stash away for the future. These contribution limits are often adjusted annually for inflation and cost of living.

Employer-sponsored retirement plans in particular are vital vehicles of our wealth-building journeys. The 401(k) plan is by far the most prevalent for private sector employees, while the 403(b) and 457(b) plans are common in public, educational, and non-profit sectors. The Thrift Savings Plan (TSP) is designed for federal employees and members of the uniformed services in the United States.

These are the 2026 limits for both workplace retirement plans and IRAs compared to 2025:

Account Type	2026	2025	Increase Amount
401(k), 403(b), 457(b), TSP, etc.	$24,500	$23,500	$1,000
IRA (Traditional or Roth)	$7,500	$7,000	$500
SEP IRA	$72,000 or 25% of total compensation	$70,000 or 25% of total compensation	$2,000
Simple IRA	$17,000	$16,500	$500

These are the contribution limits for individuals that are 50+ years old:

Account Type	2026	2025	Increase Amount
401(k), 403(b), 457(b), TSP, etc.*	$32,500	$31,000	$1,500
IRA (Traditional or Roth)	$8,600	$8,000	$600
SEP IRA	$72,000 or 25% of total compensation	$70,000 or 25% of total compensation	$2,000
Simple IRA	$20,500	$20,000	$500

*Those aged 60-63 are eligible to contribute $35,750 into their workplace retirement plan.

One important caveat: Starting in 2026, those who earn more than $150,000 must direct their 401(k) catch-up dollars into an after-tax Roth 401(k) account. If your employer doesn’t offer one, you won’t be eligible for your catch-up contributions.

It can often be quite a process to sort through all of these numbers. These are some of the most common questions we hear while planning for the year ahead:

• Should my 401(k) contributions be pre-tax or Roth?
• Should I max out my workplace retirement plan?
• Am I still eligible to contribute to a Traditional IRA or Roth IRA?
• What tax implications, for now and retirement, should I consider for the type and amount I contribute?

At One Day In July, our advisors help clients investigate these questions and design a strategic roadmap with the aim of saving for the future and reaching their financial goals. Contact us to set up a consultation and learn more.

Sources: https://www.irs.gov/newsroom/401k-limit-increases-to-24500-for-2026-ira-limit-increases-to-7500