What You Need to Know About SECURE Act 2.0 Catch-Up Changes

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Written by Kaylee England

Imagine getting a surprise power-up just before retirement. That is essentially what SECURE Act 2.0 will deliver beginning in 2025.  If you’re in your early 60s, you’ll have the opportunity to turbocharge your savings like never before. The new Roth catch-up rules come with an added silver lining: more of your retirement income may become completely tax-free. Understanding how these changes fit into your overall plan is something our retirement planning team helps clients navigate every day.

The Secure Act 2.0 (passed in 2022) is a bill that expanded upon the “rothification” goals of its predecessor bill (the original Secure Act of 2019) and created major reform initiatives to change how we think about retirement savings. 

In this post, I’ll break down two important Secure Act 2.0 provisions: the ‘super catch-up’ contribution for people aged 60–63 and the new requirement that certain high earners make their catch-up contributions as Roth (after-tax). Understanding these two provisions could help you supercharge your retirement savings and navigate a surprising tax outcome.

What Are Catch-Up Contributions?

Catch-up contributions are a feature of retirement savings accounts that allow individuals over the age of 50 to contribute an additional amount to their retirement savings. I like to think of it like packing a suitcase for a vacation. A catch-up contribution is like finding extra space in your suitcase when you thought it was full. Suddenly you can pack in a little more for the journey ahead!

And, as of January 2025, we have an additional savings power-up known as the “Super catch-up contribution” available to individuals aged 60 to 63.

These incredible savings tools can serve as a “final push” for those in their early 60s to significantly increase contributions, and they are especially beneficial for people who may have under-saved earlier in their careers. 

If you are 50+, here are the potential retirement savings impacts for 2026:

If you are between 60-63 here are the potential retirement savings impacts for 2026:

Mandatory Roth Catch-Up Contributions for Higher Earners

Before SECURE Act 2.0, catch-up contributions were fairly straightforward. Once you hit age 50, you could put in a little more each year. You also had complete flexibility in how you saved: if your plan offered a Roth option, you could choose between pre-tax catch-up contributions (for an immediate tax break) or Roth catch-up contributions (for tax-free growth later).

That simplicity is changing starting in 2026. While the SECURE Act 2.0 adds a brand-new “super catch-up” option for people ages 60–63, the law also introduces a major twist for higher earners: if your wages exceed the annual threshold, your catch-up contributions must be made as Roth. This mandatory Roth rule removes the old flexibility and could change how and when many people pay taxes on their retirement savings.

Photo courtesy of Pexels: Towfiqu barbhuiya

As of 2026, the IRS expects employers to start offering the new options by enacting “reasonable, good-faith interpretation of statutory provisions.” 

This means that employers should revise their retirement plans to include Roth catch-up contributions (if they offer them) as soon as possible in 2026, while high-earning employees will have to switch their catch up contributions to Roth contributions as the plan allows. 

Starting Jan 1, 2026, if your prior-year FICA wages from your employer exceed $150,000, you will have to make catch-up contributions on a Roth (after-tax) basis. Your employer does not have to offer catch-up contributions, but if they do, there must be a Roth option available for higher-income employees. 

Remember when I mentioned the Secure Act’s “rothification” initiatives and the silver lining?

Well, Roth contributions are made with after-tax dollars, so that means there’s no immediate tax deduction. However, when you start withdrawing the funds at 59.5 years old, the withdrawals are tax-free and not subject to Required Minimum Distributions (RMDs)!

This change presents a trade-off: higher earners may pay more tax on their funds now when they may be in their peak earning years, but the advantage is that the funds will be tax-free upon withdrawal. Additionally, these funds are not subject to Required Minimum Distributions (RMDs) so you can allow those assets to continuing growing tax-free well into retirement amplifying their value.

SECURE Act 2.0 Implications for Savers: Strategy & Considerations

For those 60-63:

If you are 60-63 years old and your employer’s retirement plan offers a super catch-up contribution, this is a big opportunity to boost your retirement savings. It is very important to evaluate and determine if you have the capacity to make those extra contributions. Even though you may be in your peak earning years, it’s still helpful to have Roth assets in retirement. 

Generally, you would want to prioritize Roth savings over saving in a brokerage account. Investment growth in a Roth account comes out tax-free, unlike in a brokerage account where you would need to pay capital gains taxes on the growth when you sell assets. Check with your financial advisor to see what makes sense for you before making any changes to your savings strategy.

For high earners (50+):

Here are some important considerations:

• If your employer’s plan lacks a Roth option, talk to HR or the plan provider. 
• Model out different “what-if” scenarios: how will your retirement income look? What’s your tax bracket now vs. later at retirement?
• Work with a fee only financial planner or tax advisor to project the long-term benefit/tradeoffs.

At Spark Financial Advisors we help clients plan for a tax-efficient retirement. You don’t want to be so good at deferring taxes during your working years that you end up with a tax bomb in retirement.

Savings Summary!

So here is a quick recap of the major changes:

• As of 2025, individuals 60-63 may be able to contribute up to $11,250 more to their employer’s retirement plans with the super catch-up contribution. Ask your employer if their retirement offers catch-up contributions.
• As of 2026, employers should be revising their retirement plans to offer Roth contributions (if they offer catch up contributions).
• As of 2027, individuals who are 50+ and earned more than $150,000 in FICA wages in 2026 must make their catch-up contributions on an after-tax (Roth) basis.

If you are unsure if these changes affect you, I encourage you to check with your employer’s retirement plan provider, review your pay and age status, and consider speaking with a financial advisor to optimize your savings strategy.

Let Spark Financial Advisors help you navigate SECURE Act 2.0 with confidence; book a call with Spark Financial Advisors today.