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Catch-up contributions: How to boost your retirement savings

Couple going over their home finances
Marko Geber/Getty Images

A common worry among many hard workers is not having enough for retirement. In fact, Thrivent's Retirement Readiness Survey found that regardless of age, not saving enough is often the biggest regret for individuals planning retirement.1

If you're in this boat, feeling angst or uncertainty as you move closer to retirement, finding ways to boost your savings can give you more confidence for your future.

Catch-up contributions are a great way to boost and revitalize your retirement savings. Instead of wondering whether you'll have enough, you can work toward closing budget gaps, building a nest egg for loved ones or giving back to the community organizations you hold dear.

What is a catch-up contribution?

Catch-up contributions allow you to add additional dollars beyond the annual contribution limit of your retirement plan.

You're eligible to make catch-up contributions if you meet the following criteria:

  • You are at least 50 years old or will be before the end of the year
  • You participate in a retirement plan that allows catch-up contributions (401(k), 403(b), IRAs, etc.)
  • You've already met your regular contribution limit for the year (see the chart below)

Benefits of catch-up contributions

These contributions offer two major benefits: lowering your taxable income and increasing your principal investment.

  • Catch-up contributions may lower your taxable income: Contributions to traditional retirement accounts, like a 401(k), 403(b) or traditional IRA, are made with pre-tax dollars. Increasing your contributions decreases your taxable income.2 If it's significant enough, the change could shift you to a lower tax bracket, saving you even more on your current year's tax bill. Note that contributions to Roth IRAs are the exception to this rule because they are made with after-tax dollars.
  • Catch-up contributions can offer the potential for higher returns: You're not guaranteed to make money when investing in the market. But by regularly investing and letting the money sit untouched over the long term, you can give it a greater chance to appreciate with compound interest.

2023 & 2024 catch-up contribution limits

The contribution limits and catch-up contribution maximums vary greatly by the type of plan. You can find the details applicable to your retirement plan below:

Plan type
Annual contribution limit
Catch-up contribution limit 2023 & 2024
Total individual contribution limit (if age 50 or older)
Large employer-sponsored retirement plans: 401(k), 403(b), 457(b)

2023: $22,500;

2024: $23,000


2023: $30,000;

2024: $30,500

Small business retirement plans: SIMPLE 401(k), SIMPLE IRA

2023: $15,500;

2024: $16,000


2023: $19,000;

2024: $19,500

Traditional IRA, Roth IRA, SEP IRA

2023: $6,500;

2024: $7,000


2023: $7,500;

2024: $8,000

Can employers match catch-up contributions?

Some employers offer to match all or a portion of your retirement contribution up to a limit. Although employers can match catch-up contributions, it is unlikely that catch-up contributions will qualify for the employer match. For example, an employer may choose to match up to 6% of your total compensation. That means any contributions you make above 6% of your salary will not be matched by your employer. Because catch-up contributions must exceed the annual contribution limit, in most cases, catching up will put you over the employer match limit. To be sure of what your employer will match, it's best to review the details of your employer plan.

What your employer puts into your account does not count toward your salary deferral limit. So if you're making a 401(k) catch-up contribution and have an employer match, you could accumulate more than the $7,500 catch-up limit, and that's allowed by the IRS. You'll be within IRS limits as long as your total contribution amount—including all retirement accounts and employer contributions—does not exceed $73,500 in 2023, $76,500 in 2024 or 100% of your salary, whichever is less.

When does it make sense to make catch-up contributions?

Catching up on retirement savings is helpful for anyone 50 or older looking to boost their retirement savings. Even so, it may not be worth it. After all, maxing out your retirement savings above the annual limit can be a big ask—especially amid rising inflation and uncertainty. Yet, increased costs and uncertainty are good reasons to make sure you have what you need in retirement.

If you're wondering whether catching up is a good idea, start by reviewing how you're tracking toward your retirement goals. A retirement calculator can be a very effective tool for seeing where you stand.

Maybe you didn't save as much as you wanted when you were younger, or you were hit with some unexpected, large expenses. Situations like these can thwart even the best financial strategies. Contributing additional dollars could help close the gap between your income and your retirement needs.

Even if your financial journey has been smooth and you're right where you want to be, taking advantage of the catch-up limit can move the needle. It can allow you to leave more for your loved ones or have some to give back to the charities and organizations that keep your community strong.

How to make a catch-up contribution in 5 easy steps

Making these types of contributions can be straightforward as long as you keep the following considerations in mind:

1. Know your plan's provisions. If you're turning 50 by the end of the year, the first step is making sure your retirement plan has a catch-up program and that you understand the stipulations. Some plans have limits that differ from IRS rules, so do your due diligence before increasing your contribution.

2. Calculate your catch-up amount. Setting up a catch-up contribution is as simple as increasing the amount you defer to your retirement savings, but you'll want to be intentional with your increase. Make sure your added contribution is enough to help you reach your goals.

3. Adjust your budget. Whether money is tight or you have a little breathing room each month, know how your updated contributions will affect your budget. You may need to adjust and realign your spending and saving so you can reach your unique financial goals.

4. Make the changes. Many plans allow you to increase your contributions online, or you can contact your plan administrator. Employer-sponsored plans may require you to make your changes before the end of the year. The deadline for updating IRAs is before your next income tax return.

5. Review your contributions regularly. At the end of the year, the administrator will look at your total contributions and notify you of any amount above the annual limit as a catch-up contribution. They can work with you to have the excess contributions, plus any accrued earnings, withdrawn.

A financial advisor can help with retirement planning

Whether you're closing a budget gap, leaving more for your loved ones or planning to give back to the community and organizations you hold dear, catch-up contributions can move you closer to your desired retirement lifestyle. Even if you max out your total contribution, there are ways you can save for retirement and still meet your goals.

Connect with a local financial advisor to quantify the expense of your retirement vision. They can help navigate options that will help you meet your retirement goals.

1 Methodology: This research was conducted in June 2022 among a national sample of 1,500 adults in order to measure their sentiments, financial planning, knowledge, and issues regarding retirement. The interviews were conducted online and the data was broken into three sample groups; Saving, Nearing, and Retired. Results from the full survey have a margin of error of plus or minus 3 percentage points.

2 If you are an active participant in an employer-sponsored retirement plan for 2023 your contribution deduction is reduced if MAGI is between $73,000 and $83,000 on a single return and $116,000 and $136,000 on a joint return. If you're married filing jointly and an active participant in an employer-sponsored retirement plan and your spouse is not, the deduction for your spouse's contribution is phased out if MAGI is between $218,000 and $228,000. If you are an active participant in an employer-sponsored retirement plan for 2024 your contribution deduction is reduced if MAGI is between $77,000 and $87,000 on a single return and $123,000 and $143,000 on a joint return. If you're married filing jointly and an active participant in an employer-sponsored retirement plan and your spouse is not, the deduction for your spouse's contribution is phased out if MAGI is between $230,000 and $240,000. If you're a married taxpayer who files separately, consult your tax advisor.

State tax rules may differ from federal rules governing the tax treatment of Roth IRAs, and there may be conflicts between federal and state tax treatment of IRA conversions. Consult your tax professional for your state's tax rules.

Thrivent and its financial advisors and professionals do not provide legal, accounting or tax advice. Consult your attorney or tax professional.