The mega backdoor Roth

The 'mega backdoor Roth' is a strategy available in some 401(k) plans that lets you contribute additional after-tax money above the standard pre-tax limit and convert it to Roth. Done right, it can move $30,000 or more per year into Roth status, on top of regular contributions. It's the most powerful legal retirement savings strategy for high earners with the right kind of 401(k).

The total 401(k) limit

Most people know the 'employee contribution' limit ($23,500 in 2026). Fewer know there's a TOTAL 401(k) limit — employee + employer + after-tax contributions combined — of about $70,000 in 2026. The gap between your personal contribution + the match and $70k is the space the mega backdoor fills.

How it works

1. Contribute the regular $23,500 to your 401(k) in pre-tax or Roth dollars.
2. Check if your plan allows after-tax (non-Roth) contributions. Not all plans do — this is the gate.
3. If yes, contribute after-tax dollars up to the total combined limit.
4. Immediately convert (or transfer) those after-tax contributions to Roth — either via in-plan Roth conversion or an in-service distribution to an external Roth IRA.
5. The contribution amount converts tax-free; any small earnings during the brief holding period get taxed as ordinary income.

Who this is for

High earners who have already maxed every other tax-advantaged account (401(k), HSA, Roth or backdoor Roth IRA) and still have savings capacity. If you're saving 30% of a large income and need more places to put it, this strategy can double or triple your annual Roth-space contributions.