Catch-Up Contribution
Also called: catch up contributions, age 50 catch-up
Catch-up contributions let savers aged 50 and over exceed the normal limit, on the theory that late-career earnings are highest and time is short. They apply to 401(k)s, IRAs and HSAs at different amounts. Recent US rules require high earners to make workplace catch-ups on a Roth basis, which raises current tax but buys tax-free growth — a change that quietly favours anyone with a large pre-tax balance already.