Save More for Retirement With New Catch-Up Options
If you’re a late-career member participating in the Commonwealth of Virginia 457 Deferred Compensation Plan who has fallen behind on your retirement savings, catch-up contributions allow you to save more by exceeding the standard retirement savings limit. It’s also a way for you to maximize tax deductions related to retirement contributions.
The Internal Revenue Service sets annual deferral limits for retirement savings. For 2025, the limit has increased to $23,500. The annual limit applies to:
- Voluntary contributions that Hybrid Retirement Plan members make to the Hybrid 457 Deferred Compensation Plan.
- Roth after-tax or pre-tax contributions made to the Commonwealth of Virginia 457 Deferred Compensation Plan.
- Contributions made to other supplemental 457 plans.
As a reminder, hybrid plan members should save the maximum 4% in voluntary contributions to take full advantage of the employer match before contributing to other supplemental savings plans.
If you participate in the Commonwealth of Virginia 457 Plan, you can use one of three different catch-up options:
- Ages 60-63 Catch-Up | $11,250 in 2025: Members aged 60-63 can take advantage of a new “super-catch-up contribution” limit under the SECURE 2.0 Act. This limit is set at the greater of $10,000 or 150% of the Age 50+ Catch-Up limit, resulting in $11,250 for 2025.
- Age 50+ Catch-Up | $7,500 in 2025: Members who are 50 or older during the calendar year may contribute an additional amount over the regular IRS annual contribution limit to the 457 Plan. You cannot use the Age 50+ Catch-Up and the Standard Catch-Up in the same calendar year.
- Standard Catch-Up | $23,500 in 2025: During each of the three calendar years before normal retirement age, Commonwealth of Virginia 457 Plan participants may contribute up to twice the regular IRS annual contribution limit or the regular annual limit plus the amount of their Standard Catch-Up credit, whichever is less. The Standard Catch-Up credit is the amount you were eligible to contribute but did not contribute in previous years.
