Do I need to hit my 401(k) contribution limit before I can begin making catch-up contributions?
You generally need to reach the limit established by the plan in order to make catch-up contributions; therefore, if the plan limit is $15,500, you will be able to make catch-up contributions only after you have reached that limit, assuming you will be at least 50 years old by year-end.
If the plan has a limit on your salary deferral contributions to 10% of your compensation and your compensation is $100,000, you would be eligible to make catch-up contributions after having reached the $10,000 limit.
However, it is important to note that qualified plans are not required to permit catch-up contributions, so the plan administrator or the summary plan description should be consulted to determine whether making catch-up contributions is even an option for you.
For more insight, see Retirement Savings Tips For 45- To 54-Year-Olds.
This question was answered by Denise Appleby