Catch-up Contributions for High Earners Moving to Roth in 2026

Under Secure Act 2.0 Section 603, 401(k) and 403(b) catch-up contributions for employees who are aged 50+ and who earned more than $145,000 in 2025 must make their catch-up contributions as Roth (after-tax) starting in 2026. Drexel’s 403(b) plan must comply with this new law. This change affects how these contributions are taxed, moving employees from a pre-tax to an after-tax basis, which may impact take-home pay and retirement tax strategies.

Employees aged 50 and older can contribute an additional $7,500 (2025) on top of the standard limit of $23,500 (2025), subject to change in 2026. Employees aged 60 to 63 can make super catch-up contributions increasing their limit to $11,250 (2025). With the new Secure 2.0 section 603 regulation, any contributions over the limit of $23,500 (2025), subject to change in 2026, will need to be Roth contributions.

If you earn more than $145,000 in the calendar year 2025, you may want to schedule an appointment with your financial advisor to better understand your taxable income for 2026. Or you can schedule a virtual or in-person consultation with one of Drexel’s TIAA advisors by calling 800.732.8353, Mon-Fri, 8 a.m.-8 p.m., or visiting tiaa.org/schedulenow-drexel. You can also contact TIAA participant services on 800.842.2252, Monday-Friday, 8 a.m.-10 p.m.

Stay tuned for additional information as Drexel moves closer to implementation of this regulation.