Retirement Account Catch-Up Contributions

It is commonly believed that retirees spend less during retirement. If this is true, is the reduced spending a result of fewer expenses? Or, is it a result of having less money to spend? Our experience informs that the latter is more often the case.

Over the years, several account types were created to incentivize and encourage retirement planning. The IRS went a step further to provide higher contribution limits to those over 50 years of age. The extra contribution for this age group is known as the “catch-up” contribution.

Taking advantage of the catch-up contribution helps you save more for retirement and encourages you to be more mindful of your current spending.  Since your spending habits will likely carry into retirement, it is ideal to save and invest as much as you comfortably can before retirement.

Below are the 2019 and 2020 tax year contribution/deferral limits. Please contact your tax advisor before significantly altering your retirement savings tax strategy. Contact us with any retirement planning questions.

Traditional IRA or Roth IRA

  • Contribution Limit: $6,000 (2019), $6,000 (2020)
  • Over 50 Catch-up: $1,000 (2019 & 2020)


  • Contribution Limit: Capped at the lower of $56k in 2019 ($57k, 2020) or 25% of your self-employment net income. Consult your tax advisor before contributing to a SEP IRA.
  • The SEP IRA does not permit a catch-up contribution


  • Employee Deferral Limit: $13,000 (2019), $13,500 (2020)
  • Over 50 Catch-up: $3,000 (2019 & 2020)
  • Employer Contribution Limit: Depends on the plan document

Defined Contribution Plans: 401(k), 403(b), 457(b), Roth 401(k)

  • Employee Deferral Limit: $19,000 (2019), $19,500 (2020)
  • Over 50 Catch-up: $6,000 (2019), $6,500 (2020)
  • Employer Contribution Limit: Depends on the plan document

Special Cases

  • Some 403(b) plans allow employees with at least 15 years of service to make an extra deferral that is separate from the standard $6,000 catch-up previously discussed. Click here for the IRS’s rules, and contact your employer to verify your options.

Please visit the IRS website for more details, and please stay healthy and safe during this stressing time.  We are here to assist you so please do not hesitate to call.

All the best,

The Gamble Jones Team

P.S. While Gamble Jones is still working remotely, we have now set up our phone system so that Rebecca can answer your calls as they come in as she usually does.  She will be monitoring the phones on weekdays between 8:00 AM PST and 4:00 PM PST.