2025 Contribution Limits
November 4, 2024
The new Retirement Plan Contribution Limits are official!
The following limits are going up for 2025:
- Maximum contributions for 401(k), 403(b) and 457 increases to $23,500
- Maximum contributions for highly compensated employees increased to $160,000
- Maximum contributions for SIMPLE retirement accounts increased to $16,500
- Maximum contributions for Defined Contribution Limit increased to $70,000
- NEW Super Catch-up for Age 60-63 is $11,250
There are a number of new provisions including the "super catch-up" for ages 60-63. Review the full list of contribution limit changes here.
Most business owners focus most of their attention on revenue and growth, thinking about taxes only when necessary. Yet the structure of a business plays a pivotal role in retirement planning, influencing contribution limits, deductions, and long-term outcomes. Understanding the relationship between entity type and retirement planning is critical to maximizing contributions, deductions, and long-term retirement income.
For many employers, payroll is the operational backbone of the organization. It touches compensation, taxes, benefits, and reporting—so it’s understandable why retirement plans are often bundled there as well. If payroll providers offer a 401(k) solution, it can feel efficient to keep everything under one roof. But efficiency in payroll processing is not the same as effectiveness in retirement plan administration. As retirement plan regulations grow more complex—particularly under SECURE 2.0—many plan sponsors are discovering that payroll platforms simply weren’t designed to handle the interpretive, judgment-based responsibilities required to administer a qualified retirement plan.
It’s Not Just You: 2026 Feels More Complicated for Retirement Plans, because It IS More Complicated!
If administering a retirement plan feels more complicated than it used to, you’re not imagining it. The changes taking effect in 2026 are a continuation of several years of phased-in legislation, inflation adjustments, and regulatory guidance, much of it stemming from the SECURE 2.0 Act of 2022. Add in changes that took effect in 2024 and 2025, and the result is a retirement plan environment with more moving parts than many employers and participants are equipped to manage. Here’s what’s changing, and why 2026 stands out.