Group 1 - The contribution limit for 401(k) plans will increase to $24,500 in 2026 from $23,500 in 2025 as per IRS guidelines [1] - The Secure 2.0 Act of 2022 introduces changes specifically affecting high earners over 50, requiring them to make catch-up contributions after taxes to a designated Roth 401(k) account starting in 2026 [3] - This new rule allows for tax-free withdrawals in retirement for eligible individuals, although it requires paying taxes on contributions upfront [3] Group 2 - Financial advisors suggest that paying taxes on contributions now may be beneficial if future tax rates are expected to rise or if individuals desire more flexibility in managing taxable income during retirement [4] - A balanced approach that combines traditional and Roth contributions can help manage tax exposure effectively across retirement [5] - Many individuals over 50 do not currently make catch-up contributions to their 401(k)s, indicating a potential area for increased retirement savings [6]