What Does SECURE 2.0 Mean for My 403(b) and 457(b) as a University Employee?
By Nancy Alekseyev | State Pension Advisory Services | Updated 2026 2026
Key Takeaways
- SECURE 2.0 raised 2026 contribution limits and created a new “super” catch-up for employees ages 60–63 — potentially $35,750 into a single 403(b) or 457(b) in one year.
- Starting January 1, 2026, higher-earning university employees (roughly $145,000+ in prior-year wages) must make age-50+ catch-up contributions as Roth, not pre-tax.
- If your plan does not offer a Roth option, you may temporarily lose the ability to make catch-up contributions entirely.
- Adjunct and part-time faculty at private universities may now qualify to contribute to the 403(b) for the first time, thanks to new long-term part-time employee rules.
- Most of these changes require your institution to update its plan documents and payroll systems. Not every university has implemented every provision yet — check with HR.
One of my goals is to always provide my clients with the latest updates.
In 2026, SECURE 2.0 is the most significant update to retirement plan rules in years, and several of its provisions land directly on the accounts most university employees rely on: the 403(b) and the 457(b).
If you are already familiar with how those two accounts work and how they fit together (–> link up to 403(b) vs. 457(b) subpillar post), this blog will cover what changed in 2026 and what those changes mean for your specific situation.
There are three changes worth understanding:
- Higher limits with a new age-based super catch-up
- A mandatory Roth requirement for high-earning participants making catch-up contributions
- Expanded eligibility for part-time employees
Each one affects a different group of university employees — and for some, the impact is immediate. So let’s look at each.
Change 1: Higher Limits and the New Ages 60–63 Super Catch-Up
The base contribution limits for 2026 are $24,500 per plan — unchanged in structure, but higher than prior years.
For employees contributing to both a 403(b) and a governmental 457(b), the combined pre-tax deferrals are still $49,000 before any catch-ups.
What is new under SECURE 2.0 is a higher catch-up tier specifically for employees ages 60 through 63.
Instead of the standard $8,000 age-50+ catch-up, employees in this age band can contribute an additional $11,250 per plan in 2026 — bringing the total possible deferral to $35,750 into a single 403(b) or 457(b).
Employees age 50–59 and 64 or older stay at the standard $8,000 catch-up. The elevated window is specifically four years: 60, 61, 62, and 63.
| Age Group | 2026 Employee Deferral Limit (per plan) | Catch-Up Amount |
| Under 50 | $24,500 | None |
| Age 50–59 and 64+ | $32,500 | +$8,000 (standard) |
| Ages 60–63 (SECURE 2.0 super catch-up) | $35,750 | +$11,250 |
For late-career faculty and administrators who have not maximized their savings throughout their careers, the ages 60–63 window is a meaningful opportunity to make a lot of contributions in a short period — on top of whatever the state pension is building toward at the same time.
Change 2: The Roth Catch-Up Mandate for High Earners
This is the change I have been flagging most urgently to clients in their 50s who are contributing catch-up amounts to their 403(b) or 457(b).
Starting January 1, 2026, if you earned more than approximately $145,000 in FICA wages from your university in the prior year, your age-50+ catch-up contributions must be made as Roth — meaning after-tax dollars, not pre-tax.
The IRS finalized this rule in late 2024, and it is now in effect.
For university employees who have been using catch-up contributions as a straightforward pre-tax deduction for years, this changes the math in two ways:
- You will pay income tax on the catch-up amount now, rather than in retirement. Whether that is better or worse depends on your current tax bracket versus your expected retirement bracket, which is not a simple calculation for most people.
- If your university’s 403(b) or 457(b) plan does not yet offer a Roth contribution option, you cannot make catch-up contributions at all until the plan is amended. This is an HR and plan-sponsor issue, not something you can resolve on your own.
The IRS finalized the Roth catch-up rules in a Treasury and IRS news release on final Roth catch-up regulations.
The University of Michigan HR page on the 2026 Roth mandate and the University of Maryland’s catch-up contribution update are both clear, practical reads for university employees trying to understand what this means for their paycheck.
Who Does SECURE 2.0 Affect?
If your prior-year FICA wages from the university were below the approximately $145,000 threshold, this rule does not apply to you.
Your catch-up contributions continue as pre-tax deferrals with no change.
If you are above the threshold, the question is not whether to stop making catch-up contributions — Roth contributions are still valuable, particularly for employees whose retirement income may push them into a higher bracket later.
The question is whether the Roth treatment fits your tax strategy, and whether the plan is ready to accept them.
This is one of the situations where a one-time review with an advisor who understands university benefits makes a measurable difference. (Tax Free Retirement Section)
Change 3: Part-Time and Adjunct Faculty May Now Qualify
SECURE 2.0 expanded access to 403(b) plans for long-term part-time employees at private, nonprofit universities.
Under the new rules, employees who have worked at least 500 hours per year for two consecutive years generally must be allowed to make elective deferrals to the 403(b) — even if they were previously excluded.
This applies specifically to ERISA-covered 403(b) plans, which primarily affect private universities.
Public university 403(b) plans are governmental plans and are not subject to ERISA, so these new eligibility rules do not extend to most public institution employees.
For adjunct faculty and long-term part-time staff at private universities, this is a meaningful change. Many have been contributing years of service to institutions that excluded them from the supplemental retirement plan. That changes with 2025 plan years and beyond.
What Should You Do Next?
SECURE 2.0 created genuine planning opportunities — but it also comes with some complications. The right response depends on where you are in your career, and I’m always ready to discuss your options!
- Ages 60–63: Review whether you are taking full advantage of the super catch-up. If cash flow allows, this four-year window is one of the most powerful savings accelerators available to university employees.
- Age 50+ and higher-earner: Contact HR to confirm whether your plan has been amended to allow Roth catch-up contributions. Then decide — with an advisor if needed — whether Roth catch-ups make sense for your tax picture.
- Adjunct or part-time at a private university: Ask HR whether you now qualify to contribute to the 403(b). You may have access to things you did not have before.
- Everyone: Check whether your institution has adopted optional SECURE 2.0 provisions, including Roth employer matching and flexible deferral change windows for 457(b) participants.
Most of these changes require your university to update its plan documents. Not every institution has adopted every optional provision, and some required provisions are still being implemented.
When in doubt, ask HR specifically what has changed for plan year 2026.
Have Questions About How This Affects You?
If you are unsure whether the Roth catch-up rule applies to you, whether your plan has been updated, or how the new limits fit into your retirement picture alongside your state pension, those are exactly the questions a free consultation is designed to answer.
I work with university employees across all 50 states, and these 2026 changes are coming up in nearly every conversation right now.
Schedule a free consultation, and we will look at your specific accounts, your income, and your timeline together.
Frequently Asked Questions
SECURE 2.0 is a federal law passed in 2022 that updated the rules governing workplace retirement plans, including 403(b) and 457(b) accounts. Several of its provisions took effect in 2026, including higher contribution limits, a new catch-up tier for employees ages 60–63, and a Roth requirement for high-earning participants making catch-up contributions.
Yes. The base employee deferral limit rose to $24,500 per plan. Employees aged 50–59 and 64 or older can contribute an additional $8,000 catch-up contribution. Employees ages 60–63 have a new higher catch-up of $11,250 under SECURE 2.0, bringing their total possible deferral to $35,750 per plan
University employees who earned more than approximately $145,000 in FICA wages from their employer in the prior year. If you meet that threshold, your age-50+ catch-up contributions to your 403(b) or 457(b) must be made as Roth — after-tax — starting January 1, 2026. Employees below that threshold are unaffected.
If your plan has not been amended to allow Roth contributions and you are a higher-earning employee subject to the Roth catch-up mandate, you cannot make catch-up contributions until the plan is updated. This is a plan-sponsor issue your HR or benefits office needs to resolve. Contact them directly and ask whether your plan is Roth-enabled for the 2026 plan year.
It can, depending on where you work. Private, nonprofit universities with ERISA-covered 403(b) plans must now allow employees who have worked at least 500 hours per year for two consecutive years to make elective deferrals. Public university plans are governmental and not subject to ERISA, so these eligibility rules generally do not apply to employees of public institutions.
Your required action depends on your age and situation. If you are 60–63, use the higher catch-up limit. If you are 50 or older and earn above the threshold, ask HR about Roth catch-up contributions. If you are part-time at a private university, check if you now qualify to contribute. For all others, confirm your institution implemented the 2026 plan changes.
Helpful Resources
- IRS: Final Regulations on the Roth Catch-Up Rule — Official IRS guidance on the 2026 mandate
- University of Michigan HR: SECURE 2.0 Roth Mandate for 2026 — Practical breakdown for university employees
- University of Maryland HR: New IRS Rule for Catch-Up Contributions — University-specific implementation guidance
- Fidelity: SECURE Act 2.0 Overview — Participant-friendly summary of all major provisions
- ASPPA: IRS Guidance on Long-Term Part-Time Employees in 403(b) Plans — Details on the new part-time eligibility rules
Disclaimer: This article is for educational purposes only and does not constitute personalized financial, legal, or tax advice. Contribution limits, plan rules, and withdrawal provisions vary by institution and are subject to change. Consult a licensed financial professional before making retirement planning decisions.
