2026 401k limits
personal- $24,500
Combined -$72,000
income limit $360,000

the max DL can put into your 401k for 2026 is $64,800 (18% of $360,000) if you are trying to minimize your 401k contributions, you can either contribute a flat 2% or stop contributing at $7,200. I cannot remember if the PS election tool allows us to make a dollar amount or just %, but either way you could use that to get close to $7,200 and put the rest in after you hit the income limit. Or just do 2% all year.

 

the long answer is to call the R&I guys and walk through the flow of dollars. You can also see the latest R&I comm for the max amounts for 2026.

here’s the short version. Every dollar you make from flight pay/flight advance and PS gets 18% allocated to the 401k. Company dollars always go first. Catchup dollars are always only your dollars and are a separate category. You can put catchup in any time regardless of how much the company has contributed. Back to the 18%… the company will be putting in the money until the 401k hits $72,000 OR your income hits $360,000. The max the company get get into the 401k for 2026 is $64,800. That’s 360k @ 18%. So if you wait and want to put in money later in the year you would only be able to get $7,200 in there. To limit MBCBP you have to limit your contributions (so $7,200). If you want to get your full personal contributions in, you need to be aggressively putting in money at the beginning of the year because once the 401k hits $72,000, all company contributions go to the MBCBP.

feel free to send a dart or check out the R&I docs in comply for “where’s my money” and “delta savings plan strategies”. A good bit of time was spent on trying to make those easy to understand for those who don’t speak 401/415/414 IRC.

 

What is the advantage to maxing the 401k just enough to not allow MBCBP contributions?

This sounds like reducing retirement savings with extra steps?

 

Assuming you'd get that money as cash instead to invest in other things

 

There are some people appalled by the lack of growth in the plan. They'd rather be taxed on that money at a higher rate and hope their investments otherwise are enough to overcome the tax hit

 

32%?! That’s a lot of return in one year.

 

. don't forget your state tax as well!

 

No one should be negatively surprised by the MBCBP growth rate, in fact I think this year it was 12%, which is significantly higher than any forecast for the underlying assets.

while for this year, yes. That money will be taxed as income one way or another. If I take that money as cash today and invest it I pay income taxes now (let’s say 32%) but only LTCG tax on the growth when I sell (18.8%). if that money goes to the MBCBP that will still be taxed upon withdrawal, and it’s not too unreasonable to think some of us may be in a similar/ higher tax bracket in retirement.

The younger you are the more the rate of return matters. The closer you are to retirement the more the tax advantage matters.

 

Some people don’t want anymore $$ locked into a plan that you can’t penalty-free withdraw until 59 1/2.
To those calculating whether the MBCBP is worth it, goto 401k.com->MBCBP->Plan information->MBCBP Investment Performance Report

Annualized returns since the 2023 inception have gone from a low of 13.41% to a high of 19.37%. It generally is 14-16% (and no 1.85% ALPA dues ).

 

no ALPA dues on any 401k excess money paid as cash either now.