At 63 She Took a Job Paying Over $150,000. The Catch-Up Rule Checked a Paycheck That Didn’t Exist.

At 63, a woman returned to the workforce after a long career at a nonprofit organization. Her new job at a private company paid over $150,000, but the company's 401(k) plan had a twist. The Roth catch-up rule would require her to contribute to a Roth account, which she initially found concerning. However, she discovered that her prior-year FICA wages from the previous employer were $0, despite earning more than $150,000 at her previous job.

This meant that, for Social Security purposes, her 2026 earnings didn't count towards the earnings test. The 401(k) plan looked backward and saw no paycheck from the previous employer, allowing her to make a pre-tax contribution if desired. The article emphasizes the importance of understanding the different rules for retirement planning and benefits, as the same person can have different earnings evaluated by Social Security and a 401(k) plan.