retirement account<\/a> to not force savers to take RMDs. But thanks to the SECURE 2.0 Act, a couple of years ago, Roth 401(k)s stopped requiring RMDs, too.<\/p>\nThat, frankly, is a game-changer for many savers — particularly higher earners.<\/p>\n
Roth IRAs present two issues for higher earners. First, they have much lower contribution limits than 401(k) plans. Second, higher earners are barred from contributing directly.<\/p>\n
Roth 401(k)s solve both of these problems. Not only are the annual contribution limits much higher, but there are no income limits associated with Roth 401(k) eligibility.<\/p>\n
In fact, thanks to a new rule taking effect in 2026, workers 50 and older with an income of over $150,000 must make their catch-up contributions in a Roth 401(k). They’re no longer allowed to make catch-ups in a traditional 401(k).<\/p>\n
So all told, right now, Roth 401(k)s really are an optimal savings solution for higher earners. With the RMD requirement gone, they offer all the benefits of Roth IRAs — and much more.<\/p>\n
If you’re a higher earner, you may be in a pretty high tax bracket. So you might assume that it’s not worth funding a Roth 401(k), because you lose the up-front tax break on contributions.<\/p>\n
But if you expect to contribute generously to a retirement account each year, over time, that balance could grow significantly. With a Roth 401(k), any gains in your account are yours to enjoy completely tax-free.<\/p>\n
While you might assume you’ll be in a lower tax bracket in retirement than you are now, that’s not a given. A Roth 401(k) gives you the freedom to take tax-free withdrawals later in life, and it means you don’t have to worry about tax rates changing for the worse.<\/p>\n
All told, eliminating the RMD requirement is quite possibly the best change Roth 401(k)s have ever undergone. That’s something worth taking advantage of, especially if you’re someone who earns a higher paycheck.<\/p>\n","protected":false},"excerpt":{"rendered":"There was a time when Roth 401(k)s were not so easy to find. But these days, many employer-sponsored…\n","protected":false},"author":2,"featured_media":364372,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[114,268,85,46,266,267,25681,19558],"class_list":{"0":"post-364371","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-finance","10":"tag-il","11":"tag-israel","12":"tag-personal-finance","13":"tag-personalfinance","14":"tag-retirement-account","15":"tag-roth-iras"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/364371","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=364371"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/364371\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/364372"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=364371"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=364371"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=364371"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
![\"A](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/03\/5bae7dfd91e02c1dd4eeb256ca987461.jpeg\")
Image source: Getty Images. <\/p>\n