Only about 15% of eligible workers actually make catch-up contributions¹ – even though these extra savings can be a retirement lifeline. Firefighters often retire around age 52², decades before Medicare or Social Security (if they even qualify for it), so even a solid pension can leave a long financial gap. Catch-up contributions let you stash more in your 457(b) or 401(k) to help fill that gap.
However, starting in 2026, higher-earning firefighters will have to make any age-50+ catch-up contributions as Roth (after-tax), so no more upfront tax break on those dollars. This change, courtesy of the SECURE 2.0 Act, was supposed to kick in 2024 but got delayed to 2026³, giving everyone a bit more time to prepare. Now that time is up and the new rule starts with your 2026 contributions (based on 2025 earnings). So, what should you do now? Below is a 2026 checklist to help ensure you’re ready for Roth-only catch-ups.
Your 2026 Roth Catch-Up Checklist
6 action items to prepare for the SECURE 2.0 changes
Understand the Rule
If age 50+ and earned over $150K in 2025, catch-up contributions must be Roth (after-tax)
Check Your 2025 W-2
Look at Box 3 (Social Security wages) from your department to see if you exceed the threshold
Verify Plan Has Roth Option
Confirm your 457(b) offers Roth contributions—without it, high earners can't make catch-ups
Consider a Roth IRA
Use a Roth IRA or backdoor Roth strategy for additional tax-free retirement savings
Rebalance Your Mix
Reassess your pre-tax vs. Roth contribution strategy based on pension and tax outlook
Maximize Your HSA
Use HSA contributions to offset lost tax breaks—triple tax benefit for healthcare costs
1. Understand the Roth-Only Catch-Up Rule (Who & What Changed)
First, let’s break down what’s changing. Under SECURE 2.0, if you’re age 50 or above and earned over a certain amount in wages last year, any catch-up contributions you make must go into a Roth account³. In other words, you won’t get the upfront tax deduction on those age-50+ “extra” contributions anymore. Those dollars will be taxed now, but then they’ll grow tax-free for retirement. If you earn below that threshold, nothing changes: you can still choose pre-tax catch-ups if your plan allows, and get the tax break now.
Who does it affect?
Generally, higher-income firefighters, like those in senior ranks or racking up a ton of overtime that pushes their wages over the limit. The law sets the bar at $145,000 of wages (indexed for inflation) from your fire department employer³. For 2026, that threshold works out to about $150,000 of W-2 wages from your department⁴. If you made more than that in 2025, you’re in the Roth-only zone for any catch-ups this year. If you made less, you’re off the hook for now, and you can continue making catch-up contributions pre-tax in 2026, if that’s what you prefer.
2026 Roth-Only Catch-Up Threshold
You can continue making catch-up contributions as pre-tax (traditional) if you prefer, keeping your current tax break.
All age 50+ catch-up contributions must go into a Roth account. No upfront tax deduction on catch-ups.
Based on Social Security wages (Box 3) from your fire department employer only
When does it start?
January 1, 2026. The IRS gave a two-year grace period (2024–2025) to allow plans to get ready³. But as of now in 2026, the rule is in effect for all applicable catch-up contributions (determined by your 2025 earnings).
2. Check If You Exceed the Income Threshold
Next up: figure out whether this Roth-only rule actually applies to you. The determination is based on your prior year’s wages with your current employer, specifically your Social Security wages (Box 3 on your W-2)⁴. So, pull out your 2025 W-2 from the department. Did Box 3 show more than around $150,000? If yes, brace yourself – any catch-up contributions you make in 2026 must go to a Roth account (no tax deduction). If it was below that, you’re off the hook and can keep making catch-ups pre-tax if you want (you might still choose Roth, but it won’t be required).
A few nuances about the threshold: It’s indexed for inflation, so $145,000 isn’t a static number – it edged up to $150,000 for determining 2026, and it will likely tick up in future years⁴. Also, it only counts wages from the employer sponsoring your plan. That means if you switched departments last year, the IRS only looks at what you earned with your current department⁴. (If you have a side gig or your spouse works, those earnings don’t count toward this threshold.)
If you’re over the threshold, going forward, your age 50+ catch-up contributions will be Roth, no exceptions. You’ll pay income tax on that money now (since it’s taken out of your paycheck after-tax), but those dollars will grow tax-free and come out tax-free later. Be prepared for a slightly lower take-home pay once you start making Roth catch-ups, since you’re giving up that tax deferral. It might sting a bit in the short term, but you’ll thank yourself in retirement.
If you’re under the threshold, you can continue making catch-up contributions as tax-deferred (pre-tax) if that’s your preference. The rule doesn’t apply to you unless/until you cross that income line. That said, it could be worth considering Roth contributions voluntarily (at least for part of your savings), especially if you suspect your retirement tax rate could be higher or you might hit the threshold down the road. Many mid-career firefighters see their earnings jump with promotions or lots of overtime in the years before retirement, so you don’t want to be caught by surprise in 2027 or 2028 if you suddenly have to switch to Roth.
3. Ensure Your Plan Is Roth-Ready (No Roth Option? Take Action)
This one’s critical: double-check that your 457(b) or 401(k) plan at work offers a Roth contribution option. If your fire department’s plan doesn’t have a Roth account feature, higher earners will be unable to make catch-up contributions at all starting in 2026⁵.
If your plan was missing a Roth feature, hopefully the IRS’s delay gave your employer time to add one. Most large public-sector plans have introduced Roth options in recent years, but if yours is still an outlier, it’s time to rattle some cages. Talk to your plan administrator, benefits office, or union reps about implementing a Roth 457(b) feature pronto. Remind them that without a Roth option, a whole group of firefighters (the higher-paid captains, chiefs, etc.) will lose out on a crucial savings opportunity. It might simply be a matter of updating the plan documents and record-keeping system.
Backup plan if no Roth is available: Let’s say worst-case your plan still lacks a Roth option. If you’re above the income limit, you simply won’t be allowed to make catch-up contributions in 2026. That’s a lousy outcome, but you can still divert that would-be catch-up money into other accounts, like an IRA.
For example, you could contribute to a Roth IRA (if your income allows) or use a backdoor Roth strategy if you’re above the IRA income limits (more on this in the next section). An IRA contribution won’t let you save as much as your 457 plan catch-up would (IRA limits are lower), but at least you can get some extra retirement dollars put away in a tax-advantaged account rather than missing out completely.
4. Use a Roth IRA (or Backdoor Roth) if Needed
Even as your 457 plan shifts toward Roth for catch-ups, don’t forget about the good old IRA. If you haven’t already, 2026 is a great time to open a Roth IRA or max it out. A Roth IRA gives you another bucket of tax-free retirement money, and unlike your 457(b) it’s all yours (no employer plan rules to worry about). As long as your income is below the IRS’s Roth IRA limits, you can contribute up to the annual IRA maximum each year. For those over 50, that max is $7,500 for 2024, $8,000 for 2025, and about $8,600 in 2026 (including the IRA catch-up). It’s not as high as your 457(b) limits, but it’s nothing to sneeze at.
What if you earn too much for a direct Roth IRA?
Many firefighters in dual-income households or high-paying positions will be above the Roth IRA income thresholds (which hover in the ~$240k+ range for married couples, adjusted annually). If that’s you, consider the backdoor Roth strategy⁷. Don’t be intimidated by the name! The backdoor Roth is perfectly legal and fairly straightforward. It involves contributing to a Traditional IRA (which anyone can do, even if you can’t deduct it due to income) and then converting that contribution to a Roth IRA soon after. Because you funded the Traditional IRA with after-tax money, the conversion doesn’t trigger much additional tax (you’d only owe tax on any small gains that occurred before conversion). In the end, you’ve gotten that money into a Roth IRA despite the income limits.
A couple of caveats: If you go the backdoor route, be mindful of the IRS pro-rata rule. If you have other Traditional IRA money sitting around (from rollovers or contributions in previous years), it can complicate the tax calculations on your conversion. Essentially, you need to account for all your IRA assets when figuring the taxable portion of a backdoor Roth conversion. Also, remember to file IRS Form 8606 when you do a backdoor Roth; this form tells the IRS that you already paid tax on those IRA contributions. If this sounds complex, consult a tax professional or financial advisor to walk you through it. The key point is, you have options outside of your 457 plan to keep building up that tax-free Roth bucket, even if the new rules try to limit you.
5. Rebalance Pre-Tax vs. Roth Contributions (Mind Your Pension)
With the Roth-only catch-up rule kicking in, it’s a perfect time to reassess your overall contribution mix. For years, you might have been pumping most of your savings into pre-tax (traditional) contributions to get that immediate tax break. Now, especially if you’re a high earner, you’ll find more of your money going into Roth (after-tax) by necessity – at least for your catch-up portion. It’s important to find the right balance between pre-tax and Roth given your personal situation, pension expectations, and long-term tax outlook.
Think about your pension and your future tax bracket. If you expect a significant firefighter pension and other income in retirement, you might end up in a higher tax bracket than you assumed. Shifting some contributions to Roth now can hedge against future tax increases by building a pool of tax-free money for later. Many financial professionals recommend maintaining both pre-tax and Roth savings for flexibility in retirement⁶. Having that tax diversification means that in your golden years, you can pull from the Roth side if you don’t want to push yourself into a higher tax bracket, or use your pre-tax (traditional) money when you need the deduction. It gives you options.
Roth vs. Pre-Tax Catch-Up Calculator
See the difference in take-home pay and future value
Side-by-Side Breakdown
For illustrative purposes only. Assumes single annual contribution at year start with compound growth. Actual results will vary based on contribution timing, investment performance, and tax law changes. Consult a financial professional for personalized advice.
On the other hand, if you expect a few lower-income years (say you retire early before your pension or RMDs kick in), you might favor maxing pre-tax contributions now and then converting some of that money to Roth during those low-tax years. It’s a more advanced strategy, but it highlights that the right Roth vs. traditional mix depends on your future income picture.
If switching to Roth reduces your take-home pay, consider phasing it in gradually so it’s less of a shock to your budget. The good news is, you have 2026 and beyond to adjust – you don’t have to overhaul everything overnight. Use this time to strategically tilt your contributions rather than making a sudden 100% switch. For example, you might continue putting your regular deferrals pre-tax (to keep some current tax break), but direct your catch-up dollars into Roth. That way you’re easing into a larger Roth position. The goal is to end up with a healthy mix that suits your situation.
6. Maximize Your HSA (Health Savings Account) for a Triple Tax Break
If you have access to a Health Savings Account (HSA) through a high-deductible health plan, don’t sleep on it – the HSA can be a firefighter’s secret weapon. It offers a triple tax benefit: contributions are pre-tax, the money grows tax-free, and withdrawals are tax-free when used for qualified medical expenses⁹. That’s like getting the best of both worlds (a tax deduction now and tax-free money later). In fact, an HSA is the only savings vehicle that gives you tax-free in, tax-free out, and no taxes on the growth in between.
Why bring up HSAs in a catch-up article? Because starting in 2026, if you’re a high earner, your catch-up contributions won’t reduce your taxable income (since they’ll be Roth). But HSA contributions will still reduce your taxable income. In effect, maxing out your HSA can help offset the lost tax break from Roth-only catch-ups. For 2026, you can contribute $4,400 if you have individual HDHP coverage, or $8,750 if you have family coverage, plus an extra $1,000 if you’re 55 or older. That’s a substantial chunk of change you can deduct from your income. If you aren’t already hitting those HSA limits, consider upping your contributions.
Beyond the immediate tax relief, think of your HSA as a “stealth IRA” earmarked for healthcare. Ideally, you pay current medical expenses out-of-pocket and let your HSA funds stay invested for the long haul. After all, a 65-year-old couple might need around $300,000 for out-of-pocket health costs over their retirement⁸. Using an HSA to cover those expenses is far more efficient than pulling from a taxable pension or 457 plan. You’re essentially building a dedicated, tax-free pot of money for future medical bills.
Even if you have great retiree health benefits, odds are you’ll still have significant expenses like Medicare premiums, long-term care, or uncovered treatments. An HSA gives you flexibility to handle those without dipping into taxable income. It’s truly a powerful and underutilized tool for first responders.
Conclusion: Adapt and Overcome
The retirement landscape for firefighters is changing, but with a solid game plan you can adapt and overcome. Make sure your department’s plan is up to speed with a Roth option, and, if it makes sense, take full advantage of catch-up contributions while you can; they’re still one of the best tools for boosting your savings, even if some of those dollars have to be Roth now. Look at your income, pension prospects, and tax picture, and decide how to balance your pre-tax vs. Roth contributions in the next few years. If the new rules take away a tax break on one hand, see where you can grab another (like an HSA or IRA) with the other hand.
Our mission is to help those who protect our communities navigate financial challenges like these new SECURE 2.0 rules. We understand the unique mix of pensions, overtime, and early retirement that firefighters juggle. If you’d like a review of how Roth-only catch-up contributions affect your retirement plan, all you have to do is click the button below; we look forward to talking with you!
Sources:
- https://www.bankrate.com/retirement/top-reasons-to-make-401k-catch-up-contributions/
- https://www.federalpensionadvisors.com/post/understanding-firefighter-retirement-what-you-need-to-know
- https://www.franklintempleton.com/articles-us/retirement/secure-2-update-mandatory-roth-catch-up-contributions-arrive-in-2026
- https://www.franklintempleton.com/articles-us/retirement/secure-2-update-mandatory-roth-catch-up-contributions-arrive-in-2026
- https://www.bakerdonelson.com/an-employers-practical-guide-to-401k-plan-catch-up-contribution-changes-for-2026
- https://www.schwab.com/learn/story/income-too-high-roth-ira-try-these-alternatives
- https://www.schwab.com/learn/story/backdoor-roth-is-it-right-you
- https://money.com/health-care-costs-retirement-fidelity-2021-study/
- https://www.fidelity.com/viewpoints/wealth-management/hsas-and-your-retirement
