Can You Contribute to a 401k After Age 72?

Individuals can continue to build their retirement savings by contributing to a 401(k) plan after age 72. This allows for the continued accumulation of tax-advantaged funds for those who choose to work longer. This opportunity is tied directly to your employment status and is not available to everyone.

The “Still Working” Requirement for Contributions

The rule for making 401(k) contributions after age 72 is that you must have earned income from the employer that sponsors the plan. The Internal Revenue Service (IRS) defines earned income as compensation from an employer, including:

• Wages
• Salaries
• Commissions
• Bonuses

Other forms of income common for older Americans do not qualify, such as Social Security benefits, pension payments, annuity income, and investment earnings. You cannot use these funds for new 401(k) contributions. This requirement also applies to self-employed individuals with a Solo 401(k), who must have earned income from their business to contribute.

Contribution Rules and Limits After Age 72

For those who meet the “still working” requirement, the contribution rules after age 72 mirror those for younger employees. The standard employee contribution limit for 2025 is $23,500. This amount can be contributed as pre-tax dollars to a Traditional 401(k) or post-tax dollars to a Roth 401(k), if the plan offers that option.

Individuals age 50 and over can contribute an additional “catch-up” amount. For 2025, this is $7,500, meaning an individual over 50 can contribute a total of $31,000. A new provision for 2025 allows a larger catch-up for those aged 60 to 63, who can contribute up to $11,250 for a total of $34,750, if their plan adopts this feature.

Your age does not impact receiving employer contributions, such as matching funds or profit-sharing. These are determined by the terms of your employer’s plan. The total combined contributions from the employee and employer cannot exceed $70,000 in 2025, or $77,500 with the standard catch-up.

Navigating Contributions and Required Minimum Distributions (RMDs)

A common point of confusion for working individuals past age 72 is how 401(k) contributions interact with Required Minimum Distributions (RMDs). These are two distinct financial obligations. While making contributions based on current earned income, you may also be required to take distributions from retirement accounts based on your age. The age for beginning RMDs is 73 for those born between 1951 and 1959.

There is a “still working exception” that can help manage this situation. If you are still employed by the company that sponsors your 401(k) and you do not own more than 5% of that company, you can delay taking RMDs from that specific 401(k) plan until you retire. This exception’s application is plan-specific, and you must confirm that your employer’s plan document allows for this delay.

This exception does not apply to all of your retirement funds. You must still take RMDs from other accounts, such as Traditional IRAs, SEP IRAs, and 401(k)s from any previous employers. For example, a 74-year-old individual still working for Company A and owning no stock in it can contribute to their Company A 401(k) and not take an RMD from that plan.

However, this same individual must take the mandatory RMD from their Traditional IRA and from the 401(k) they hold from a former employer, Company B. The RMD calculation for these other accounts is based on their balances at the end of the previous year and the IRS Uniform Lifetime Table. Failing to take a required RMD can result in a tax penalty of 25% of the amount that should have been withdrawn.