'As Roth catch-up rules reshape contribution strategies for higher earners in 2026, Nokia employees should revisit how their workplace plans, HSAs, and IRA options fit together within a broader retirement framework,' – Patrick Ray, a representative of The Retirement Group, a division of Wealth Enhancement.
Healthcare Provider Update: Healthcare Provider for Nokia Nokia primarily utilizes Aetna, a leading health insurance provider, for its employee healthcare needs. Aetna offers a wide range of health plans designed to fit the diverse needs of Nokia's workforce across various locations. Potential Healthcare Cost Increases in 2026 As we approach 2026, healthcare costs are projected to rise significantly, influenced by multiple factors impacting the Affordable Care Act (ACA) marketplace. Insurance premiums are expected to escalate by an average of 18% nationally, with some states witnessing hikes over 60%. A critical driver behind this surge is the potential expiration of federal premium subsidies, which currently shield many consumers from high out-of-pocket expenses. Without these subsidies, the affordability of healthcare will be compromised for millions, forcing consumers to reconsider their coverage options and financial strategies in anticipation of these price increases. Click here to learn more
'With mandatory Roth catch-up contributions beginning in 2026 for higher earners, Nokia employees should take a coordinated approach to their 401(k), HSA, and IRA strategies to align income, timing, and long-term retirement goals,' – Wesley Boudreaux, a representative of The Retirement Group, a division of Wealth Enhancement.
In this article, we will discuss:
(1) How the SECURE 2.0 Act changed catch-up contribution rules beginning in 2026.
(2) What mandatory Roth treatment for higher earners means for workplace retirement planning.
(3) Additional tax-advantaged strategies Nokia employees may want to review as part of a broader retirement planning approach.
The way some higher-income employees make catch-up contributions to their employer retirement plans has changed beginning in 2026. This may directly impact many Nokia employees who are age 50 or older and earning above certain compensation thresholds.
Several legislative provisions that broaden or mandate Roth treatment in specific situations—such as requiring Roth catch-up contributions for certain higher earners—were included in the SECURE 2.0 Act of 2022 (Division T of the Consolidated Appropriations Act, 2023).
The IRS has issued guidance clarifying the implementation timeline and wage threshold under Section 603 of SECURE 2.0.
What Is the New Rule Regarding Catch-Up Contributions to 401(k)s?
If you are age 50 or older and your prior year Federal Insurance Contributions Act (FICA) wages from the employer sponsoring your retirement plan exceed the applicable threshold, your catch-up contributions must now be made as Roth contributions.
For 2026 catch-up treatment purposes, the threshold is based on 2025 FICA wages exceeding $150,000 (indexed for inflation in future years). 1
Roth 401(k) contributions are made with after-tax dollars, meaning they are not deductible in the current tax year. However, if eligible Roth 401(k) distributions are taken after the five-year holding period and after age 59½, due to disability, or after death, those distributions are generally tax-free.
2026 Contribution and Catch-Up Amounts
2026 Limits: 2
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- Employee elective deferral limit: $24,500
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- Catch-up (age 50+): $7,500
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- Catch-up (age 60–63): $11,250 (if permitted by the plan)
The total annual defined contribution limit (employee + employer contributions) for 2026 will be $72,000, excluding catch-up contributions.
If 2025 FICA wages exceed $150,000, 2026 catch-up contributions must be made on a Roth basis.
Under current law, this Roth catch-up requirement is a statutory change that does not expire unless amended by Congress.
Plans that do not offer designated Roth contributions may be unable to allow catch-up contributions once the IRS transition period concludes, which generally began in 2026.
If prior year FICA wages are below the threshold, the required Roth rule does not apply.
Other Factors to Consider When Planning for Retirement
If the catch-up rule change affects your strategy, it may be worth reviewing other tax-advantaged options available to Nokia employees.
1. Consider a Health Savings Account (HSA)
If enrolled in an HSA-eligible health plan, an HSA offers several tax features:
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Contributions are not subject to federal income tax.
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Earnings grow tax-free.
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Withdrawals for qualified medical expenses are tax-free.
Contributions made through payroll deduction are generally not subject to FICA or FUTA taxes.
After age 65, HSA funds may be used for non-medical expenses without penalty, though withdrawals are taxed as ordinary income.
HSA Contribution Limits
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2026: 3
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- $4,400 (individual)
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- $8,750 (family)
Individuals age 55 or older who are not enrolled in Medicare may contribute an additional $1,000 catch-up amount.
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2. Increase Regular 401(k) Contributions
The employee elective deferral limit increases to $24,500 in 2026.
This limit applies only to employee contributions and does not include employer matching contributions.
3. Review Partial Roth IRA Contributions
Eligibility for Roth IRA contributions is based on modified adjusted gross income (MAGI).
- 2026 Phase-Out Ranges: 2
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Single: $153,000 to $168,000
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Married filing jointly: $242,000 to $252,000
- Direct Roth IRA contributions are not permitted above the upper phase-out limit. Contributions for a prior tax year may generally be made up until the tax filing deadline of the following year.
Roth 401(k)s and Roth IRAs each have separate five-year aging requirements for qualified distributions.
4. Review a Traditional IRA
For 2026, the IRA contribution limit is $7,500, with a $1,100 catch-up for those age 50 or older.
Even if participating in a workplace retirement plan, non-deductible contributions may still be made to a traditional IRA up to the annual limit. Earnings grow tax-deferred, though non-deductible contributions do not reduce current taxable income.
5. Consider a “Backdoor” Roth IRA Strategy
A “backdoor” Roth IRA involves making a non-deductible contribution to a traditional IRA and then converting it to a Roth IRA.
Owning other traditional IRAs with pre-tax assets can affect the tax treatment of conversions due to pro-rata rules.
Converted Roth amounts must meet a separate five-year aging rule to avoid certain penalties.
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Why Professional Guidance Matters for Nokia Employees
Changes to catch-up contribution rules and shifting contribution limits can influence long-term retirement planning decisions. Coordinating 401(k) contributions, IRAs, HSAs, and Roth strategies often involves detailed analysis of income levels, plan design, and tax considerations—particularly for Nokia employees with higher earnings.
The Retirement Group can help you understand how these new regulations apply to your personal situation and assist in building a retirement strategy aligned with your long-term goals. To speak with a retirement planning professional, call (800) 900-5867.
Sources:
1. Kelley R. Taylor. “Roth 401(k) Changes: New Rules to Know for 2025 and 2026 Taxes.” Kiplinger , 2 Feb. 2026, www.kiplinger.com/taxes/roth-401k-changes-what-you-should-know .
2. United States, Department of the Treasury, Internal Revenue Service. “401(k) Limit Increases to $24,500 for 2026, IRA Limit Increases to $7,500.” IRS Newsroom , 13 Nov. 2025, www.irs.gov/newsroom/401k-limit-increases-to-24500-for-2026-ira-limit-increases-to-7500 .
3. Cross, Diane. “2026 Benefit Limits: HSA, HDHP, and ACA.” Sequoia , 15 May 2025, www.sequoia.com/2025/05/2026-benefit-limits-hsa-hdhp-and-aca/ .
What unique features and benefits does the Nokia Retirement Income Plan offer to its participants, and how can these benefits be maximized by current employees of Nokia of America Corporation? Additionally, what resources are available for employees to educate themselves about the various aspects of the plan, including eligibility, distribution options, and potential tax implications?
The Nokia Retirement Income Plan offers participants a defined benefit plan designed to provide financial security through retirement by supplementing Social Security and other retirement savings. Benefits can be maximized through strategies like ensuring accurate service records, understanding distribution options such as lump-sum payments or annuities, and consulting financial advisors to align these benefits with long-term retirement goals(Nokia of America Corpor…).
How does participation in the Nokia Retirement Income Plan facilitate financial security in retirement for employees, specifically in terms of pension benefit calculations and options such as lump-sum distributions or annuities? Moreover, what are some strategies that Nokia of America Corporation employees can employ to ensure they are fully prepared to utilize their retirement benefits as they transition towards retirement?
Participation in the Nokia Retirement Income Plan ensures financial security in retirement through pension benefit calculations based on service years and salary history. Employees can choose from options like lump-sum distributions or lifetime annuities. By carefully selecting a distribution option and incorporating it into a broader retirement strategy, employees can optimize financial outcomes(Nokia of America Corpor…).
With respect to changes in personal circumstances, such as marriage or divorce, what provisions does the Nokia Retirement Income Plan have to protect the benefits of employees from Nokia of America Corporation? How can employees navigate the complexities of Qualified Domestic Relations Orders (QDROs) within the context of their pension benefits, and what resources are available to assist them in this process?
The Nokia Retirement Income Plan protects benefits in cases of personal changes such as marriage or divorce through provisions like the Qualified Domestic Relations Order (QDRO). Employees can consult the Nokia Benefits Resource Center for assistance in navigating QDROs to ensure a fair division of benefits. Guidance is available for understanding the QDRO requirements and how they apply to their pension(Nokia of America Corpor…).
What steps must employees take to initiate the commencement of their benefits from the Nokia Retirement Income Plan once they reach retirement age? Furthermore, what are the important considerations employees need to keep in mind regarding the selection of a payment form and any potential impact this may have on their overall financial strategy during retirement?
To initiate pension benefits under the Nokia Retirement Income Plan, employees must submit a claim when they reach retirement age. They should consider factors such as payment form options (lump sum or annuity) and the impact on long-term financial plans. Choosing the appropriate payment form is critical to maximizing retirement income(Nokia of America Corpor…).
How can employees of Nokia of America Corporation ensure their beneficiaries are properly designated under the Nokia Retirement Income Plan, and what implications does this designation have for benefit distribution in the event of their death? Additionally, what steps should employees take to update their beneficiary designations in light of significant life events?
Employees can ensure their beneficiaries are properly designated by updating their beneficiary forms through the Nokia Benefits Resource Center. Proper designation affects how benefits are distributed in the event of their death, and it is crucial to update designations after life events like marriage, divorce, or the birth of a child(Nokia of America Corpor…).
In terms of compliance with federal regulations, how does the Nokia Retirement Income Plan adhere to ERISA guidelines concerning employee benefits, and what rights do employees of Nokia of America Corporation possess under these regulations? Also, how can employees exercise their rights effectively if they encounter issues regarding their pension benefits?
The Nokia Retirement Income Plan complies with the Employee Retirement Income Security Act (ERISA), giving employees the right to receive information about their benefits and hold fiduciaries accountable. If employees face issues with their pension, they can exercise their rights through claims and appeals, with recourse available through legal action if necessary(Nokia of America Corpor…).
How does the Nokia of America Corporation support employees who might be eligible for a disability pension under the Nokia Retirement Income Plan, and what specific eligibility criteria must be met? Additionally, what resources are available to assist employees in understanding this facet of their retirement benefits?
Employees eligible for a disability pension under the Nokia Retirement Income Plan must meet specific criteria, such as proving permanent disability before reaching retirement age. Resources like the Nokia Benefits Resource Center can provide guidance on the eligibility process and required documentation(Nokia of America Corpor…).
What specific actions should an employee of Nokia of America Corporation take when applying for a pension benefit under the Nokia Retirement Income Plan, and what documentation is typically required to streamline this process? Furthermore, in the event of a claim denial, what recourse do employees have to challenge the decision through the plan's appeal process?
When applying for pension benefits, employees should provide documentation such as proof of age and employment history. In case of a denial, they have the right to appeal through the Employee Benefits Committee. If necessary, employees can further appeal to federal courts under ERISA(Nokia of America Corpor…).
How does the pension benefit guarantee from the Pension Benefit Guaranty Corporation (PBGC) apply to employees of Nokia of America Corporation, and what are the limitations of this guarantee in protecting retirement benefits? Additionally, how can understanding these protections help employees make informed decisions regarding their retirement planning?
The Pension Benefit Guaranty Corporation (PBGC) guarantees benefits under the Nokia Retirement Income Plan in case the plan terminates. However, there are limitations, such as caps on benefit amounts. Understanding these protections helps employees make informed decisions about their retirement planning(Nokia of America Corpor…).
How can employees contact the Nokia Benefits Resource Center to gain more information about their benefits and the specific resources available under the Nokia Retirement Income Plan? What are the recommended communication channels and hours for reaching out to ensure timely and effective assistance?
Employees can contact the Nokia Benefits Resource Center through the Your Benefits Resources (YBR) website or by calling the designated phone line. It is recommended to use these channels during business hours (9:00 a.m. to 5:00 p.m. ET) for timely assistance with pension-related questions(Nokia of America Corpor…).
With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.
Nokia provides both a defined benefit pension plan and a 401(k) savings plan. The defined benefit plan includes legacy plans from Alcatel-Lucent and Siemens, providing retirement income based on years of service and final average pay. In 2021, Nokia merged its Retirement Plan (NRP) with the Lucent Technologies Inc. Pension Plan (LTPP) to streamline management. The 401(k) plan offers diverse investment options and company matching contributions.
Operational Efficiency: Nokia is undergoing a restructuring process that includes layoffs affecting about 5,000 employees globally. Strategic Focus: The company is shifting its focus towards 5G technology and network infrastructure (Source: Reuters). Financial Performance: Nokia reported a 7% increase in net sales for Q2 2023, reflecting strong demand for its 5G products (Source: Nokia).
Nokia provides both RSUs and stock options to its employees. RSUs vest over time, converting into shares, while stock options allow employees to buy shares at a set price.
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