Core Insights - The article discusses the growing popularity of Roth 401(k) plans and highlights the importance of considering them for retirement savings [2][3] Group 1: Roth 401(k) Plans - Roth 401(k) plans have become more popular, with 85% of employer-sponsored plans offering this option, yet only 18% of employees utilize it [2] - Unlike Roth IRAs, Roth 401(k) plans do not have income limits, making them accessible to high earners [4][5] - Contributions to Roth 401(k) plans are made with after-tax dollars, allowing for tax-free withdrawals in retirement if certain conditions are met [6][7] Group 2: Expert Opinions - Personal finance expert Suze Orman emphasizes the advantages of Roth 401(k) accounts, arguing that individuals should prioritize them regardless of their tax bracket [5] - Orman warns that traditional 401(k) plans, while providing upfront tax benefits, can lead to tax liabilities upon withdrawal in retirement [6]

Nearly 93% of employers offer a Roth 401(k) plan, according to the Plan Sponsor Council of America, but there is a chance your employer is part of the remaining 7% (3).If you believe this rule change might impact you, the first step is to reach out to your employer and ask if they offer a Roth 401(k) plan for employees.Trending: Robert Kiyosaki says this 1 asset will surge 400% in a year — and he begs investors not to miss its ‘explosion’This seemingly small change can have big consequences for many workers ...

Core Points - The IRS announced new regulations affecting 401(k) catch-up contributions starting in 2026, particularly for high-income earners [1][4] - An income test will be implemented, where individuals earning over $145,000 will only be able to make catch-up contributions to a Roth 401(k) [4][5] - This change introduces an upfront tax burden for high-income earners, as contributions to a Roth 401(k) are made with after-tax income [5] Summary by Sections Contribution Limits - For 2025, all workers can contribute up to $23,500 into 401(k) plans, with those over 50 allowed to make additional catch-up contributions [3] Income Test Implementation - Starting in 2026, workers earning over $145,000 will face restrictions on their catch-up contributions, limiting them to Roth 401(k) plans [4] Tax Treatment Differences - Standard 401(k) contributions are made pre-tax, allowing for tax deductions, while Roth 401(k) contributions are made after-tax, resulting in no immediate tax benefits [5] Impact on Workers - Approximately 20% of individuals aged 45 to 54 earn over $100,000, indicating that millions could be affected by the new regulations [6] - Employers are encouraged to confirm if they offer a Roth 401(k) plan, as nearly 93% do [6]