A cash balance plan lets older, high-earning owners contribute far more than a 401(k). See a rough maximum by age.
Provides a rough age-based estimate of the maximum contribution to a cash balance defined-benefit plan.
A cash balance plan is a defined-benefit plan, so allowable contributions rise steeply with age because older participants have fewer years to fund a large projected benefit. Someone in their late 50s or 60s can often contribute several hundred thousand dollars a year, far above defined-contribution limits. This makes these plans popular with high-earning professionals and business owners seeking to catch up quickly.
The figure shown here is only an approximation, since the true maximum is set by an actuary based on your age, income, plan design, and IRS assumptions. Cash balance plans also carry funding commitments, administrative costs, and testing rules, and they are commonly paired with a 401(k) to boost total savings. Consult an actuary and tax advisor before acting; this is not financial or tax advice.
Older, high-income business owners and professionals who want to shelter large amounts and have steady profits to fund the required contributions. Younger savers usually gain less because their limits are lower.
Federal rules require an enrolled actuary to certify the plan's funding each year, so the real contribution is a calculated figure, not a fixed cap. The estimate here is only a starting point.
Yes, pairing a cash balance plan with a 401(k) and profit-sharing plan is common and can raise total tax-deferred savings substantially. Plan design must satisfy IRS testing.
See the exact formula and a worked example on our methodology page.