Catch-up contributions: How to boost your retirement savings

Many hard workers share a common worry: not having enough saved for retirement. In fact, Thrivent’s Retirement Readiness Survey revealed that, across all age groups, the biggest regret is often not saving enough.¹

If you’re feeling uneasy as retirement gets closer, there are steps you can take to strengthen your savings and regain confidence in your financial future.

Catch-up contributions offer an excellent opportunity to supercharge your retirement savings. With this strategy, you can work toward filling budget gaps, securing a nest egg for loved ones, or creating a lasting impact by supporting causes that matter most to you.

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)

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

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 accounts, such as Roth IRAs, are the exception to this rule because they are made with after-tax dollars.

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.

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:

As of January 1, 2025, the SECURE Act 2.0 introduced higher catch-up contribution limits for those aged 60, 61, 62, and 63. During these key years, you can contribute up to 150% of the standard catch-up limit ($11,250 in 2025) to your 401(k), 403(b) or 457(b).

SIMPLE IRAs have a special catch-up, as well. For 2025, the SIMPLE IRA contribution limit is set at $16,500. However, if you're between 60 and 63, you can boost your savings even more with a $5,250 catch-up contribution in 2025.

What’s more, this enhanced contribution limit will be adjusted annually for inflation, helping you save even more as you approach retirement. It’s a golden opportunity to boost your savings when it matters most.

Learn more about more catch-up changes to come in 2026

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 $70,000 in 2025 or 100% of your salary, whichever is less.

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 high inflation. 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.

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.

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.