For many executive women, reaching the point where you can max out your 401(k) feels like an important financial milestone. You’re earning well, saving consistently, and making retirement a priority.
But maxing out your regular 401(k) contribution may not mean you’ve actually maxed out what your workplace retirement plan can do for you.
If your employer’s plan allows after-tax 401(k) contributions, you may have an opportunity to save significantly more…and potentially convert those additional savings into Roth money. For high earners, business owners, and careful savers approaching retirement, it can be a great way to build a larger pool of tax-free retirement money.
First, Know the 2026 Limits
For 2026, employees under age 50 can defer up to $24,500 from pay into a 401(k), whether those contributions are traditional pre-tax or Roth. But the overall annual limit for employee and employer contributions is much higher: $72,000.
That $72,000 limit can include:
- Your regular pre-tax or Roth 401(k) salary deferrals
- Employer matching contributions
- Employer profit-sharing contributions
- Voluntary after-tax employee contributions
For example, suppose you contribute the full $24,500, and your company contributes another $10,000. You’ve put $34,500 into the plan, but you may still have as much as $37,500 of additional room.
If your plan accepts after-tax contributions, you may be able to use some or all of that remaining space. For an executive who is trying to make the most of her highest-earning years, that can open up a significant additional savings opportunity.
Why Roth Money Can Be Especially Valuable for Executive Women
Higher income can make Roth planning more complicated. You may earn too much to contribute directly to a Roth IRA, and reducing your taxable income today through traditional 401(k) contributions may still be attractive. At the same time, you may not want all your retirement assets accumulating in accounts that will eventually be taxable.
That’s where after-tax contributions can become interesting.
After-tax 401(k) contributions aren't the same as Roth contributions. You contribute money that has already been taxed, but earnings on that money can still become taxable. However, if your plan allows it, you may be able to convert those after-tax contributions into a Roth 401(k) or move them into a Roth IRA.
You may hear this strategy referred to as a “mega backdoor Roth.” While that might sound like a villain in a horror movie, the idea is relatively straightforward: use available after-tax space in your workplace plan and strategically move that money into a Roth account, where qualified future withdrawals can be tax-free.
Your Executive Benefits Deserve a Closer Look
The catch is that this strategy isn't available in every 401(k).
Your employer's plan needs to allow after-tax employee contributions. To efficiently move that money into Roth status, you'll also want to understand whether the plan allows in-plan Roth conversions or in-service distributions to a Roth IRA.
If you're reviewing your benefits, ask:
- Does my 401(k) allow after-tax contributions?
- Does it allow in-plan Roth conversions?
- Can I roll after-tax contributions into a Roth IRA while I'm still employed?
- Can those conversions happen automatically?
- How much of the $72,000 total limit is already being used by my contributions and employer contributions?
This is also a good reminder that your benefits package is part of your compensation. If you're an executive, there may be much more to evaluate than just deciding how much of each paycheck goes into your 401(k).
Make the Most of Your Highest-Earning Years
Your peak earning years can also be some of your most complicated financial years. There may be more money coming in, but there are also more decisions competing for it.
After-tax 401(k) contributions are one tool that could help you take advantage of this period, but the real opportunity is making sure your financial strategy evolves alongside your career.
At C. Beach Brown, we help successful women turn a collection of financial decisions into a coordinated plan. If your career has grown faster than your financial strategy, let’s talk about what you can do now to make the most of what you’ve built.
A Roth IRA conversion—sometimes called a backdoor Roth strategy—is a way to contribute to a Roth IRA when income exceeds standard limits. The converted amount is treated as taxable income and may affect your tax bracket. Federal, state, and local taxes may apply. If you’re required to take a minimum distribution in the year of conversion, it must be completed before converting. To qualify for tax-free withdrawals, you must generally be age 59½ and hold the converted funds in the Roth IRA for at least five years. Each conversion has its own five-year period, and early withdrawals may be subject to a 10% penalty unless an exception applies. Income limits still apply for future direct Roth IRA contributions. This material is for informational purposes only and does not constitute tax, legal, or investment advice. Please consult a qualified tax professional regarding your individual circumstances.