How Much You Can Put Into Your 401(k) Each Year

The annual contribution limit for 2024 is $23,500 if you are under 50, and $30,500 if you are 50 or older

The 401(k) contribution limit is the maximum amount of your own money you can put into your 401(k) plan in a single calendar year. The IRS sets this limit and adjusts it most years for inflation. For 2024, the limit is $23,500 for workers under age 50. If you are 50 or older, you can contribute an additional $7,500 as a catch-up contribution, bringing your total to $30,500.

These limits explore only to the money that comes directly from your paycheck — what the IRS calls employee deferrals. Money your employer contributes to your account on your behalf does not count toward your personal limit, though it does count toward a separate combined limit of $69,000 for 2024 (or $76,500 if you are 50 or older).

The limit changes almost every year because the IRS ties it to inflation. If you are planning ahead, check your plan documents or your employer's benefits website in December to see what the next year's limit will be.

Key Takeaways

• For 2024, you can contribute $23,500 of your own money to a 401(k) if you are under 50, or $30,500 if you are 50 or older.
• Only money that comes from your paycheck counts toward your personal limit; employer contributions count separately.
• The IRS raises the limit most years to keep pace with inflation, so the number you see this year will likely be different next year.
• If you exceed the limit, your employer must return the excess to you, usually by April 15 of the following year.
• You cannot contribute more than your total earned income for the year, even if the IRS limit is higher.

How the catch-up contribution works if you are 50 or older

Once you turn 50, the IRS lets you set aside an extra $7,500 per year beyond the standard limit. This is called a catch-up contribution, and it exists because workers in their 50s and 60s often have less time to save before retirement. You do not have to do anything special to use this extra room — you straightforward tell your payroll department to deduct a higher amount from each paycheck.

The catch-up amount also increases with inflation. In 2023, it was $7,500; in 2024, it remained $7,500. Your plan administrator will tell you the current year's catch-up limit if you ask.

What happens if you contribute too much

If you accidentally put more than the annual limit into your 401(k), your employer is required to catch the error and return the excess to you. This usually happens during the plan's annual reconciliation, which occurs after the year ends. Your employer will send you the overage, typically by April 15 of the following year, and will also report it to the IRS.

The returned money is treated as if it was never contributed, so you will not face a penalty for the mistake itself. However, the overage may be subject to income tax in the year you receive it back, depending on how your plan handles the correction. Your employer's benefits team can explain the tax treatment for your specific situation.

If you contribute to more than one 401(k) — for example, if you changed jobs mid-year — you are responsible for tracking your total contributions across all plans. The IRS limit applies to your combined deferrals, not to each plan separately. If your total across all employers exceeds the limit, you must request a refund from one or both plans.

How employer contributions fit into the picture

Your employer may add money to your 401(k) through a matching contribution (usually a percentage of what you contribute) or a non-elective contribution (a set amount given to all employees). This employer money does not reduce your $23,500 personal limit. You can still contribute the full $23,500 from your paycheck even if your employer is also adding funds.

However, there is a separate ceiling that covers both your contributions and your employer's contributions combined. For 2024, the total cannot exceed $69,000 (or $76,500 if you are 50 or older and making catch-up contributions). In practice, this combined limit rarely affects workers because most employer contributions are modest. But if your employer makes a very large contribution, it could reduce the amount you are allowed to defer from your paycheck.

Your contribution limit cannot exceed your earned income

Even though the IRS allows you to contribute $23,500 in 2024, you cannot contribute more than you actually earned that year. If you made $15,000 in salary and wages, your maximum 401(k) contribution is $15,000, regardless of the IRS limit. This rule prevents people from contributing money they do not have.

Earned income includes wages, salary, bonuses, and self-employment income. It does not include investment returns, rental income, or retirement distributions. If you are self-employed and have a solo 401(k), the rules are more complex, but the same principle applies: your total contributions cannot exceed your net self-employment income for the year.

How to know if you are on track with your contributions

Your 401(k) plan statement, which you receive quarterly or can view online through your employer's benefits portal, shows your year-to-date contributions. Compare this number to the current year's IRS limit to see how much room you have left. If you are contributing through payroll deductions, divide your annual contribution goal by the number of remaining paychecks to figure out what each deduction should be.

If you change jobs during the year, remember that your limit is cumulative across all employers. If you contributed $12,000 to your old employer's plan and then start a new job, you can only contribute $11,500 more in 2024 (assuming the $23,500 limit). Your new employer's payroll department will not know about your previous contributions unless you tell them, so it is your responsibility to track the total.

Frequently Asked Questions

Can I contribute more if I have a spouse with a 401(k)?

No. The contribution limit applies to each person individually. Your spouse has their own $23,500 limit (or $30,500 if they are 50 or older), but your contributions and theirs are separate. You cannot combine your limits or transfer unused room from one person to the other.

What if I have both a 401(k) and an IRA?

The 401(k) limit and the IRA limit are separate. You can contribute the full $23,500 to your 401(k) and also contribute to a traditional or Roth IRA in the same year (though IRA contributions are much smaller — $7,000 for 2024 if you are under 50). However, if you earn too much, you may not be able to deduct traditional IRA contributions or contribute to a Roth IRA.

Do I have to contribute the maximum?

No. The limit is the maximum you are allowed to contribute, not the minimum. You can contribute any amount from $0 up to the limit. Many workers contribute less because they cannot afford the maximum or because they prioritize other financial goals.

When does the contribution limit reset?

The limit resets on January 1 of each year. Any unused contribution room from 2024 does not carry over to 2025. If you did not max out your 401(k) in 2024, you cannot make up the difference in 2025 — you straightforward start fresh with the 2025 limit.

Does the limit change if I get a raise?

The IRS limit does not change based on your salary. It is the same for everyone in a given year, regardless of how much you earn. However, your ability to reach that limit depends on your income — you still cannot contribute more than you earned.