Restoring and protecting “blue carbon” ecosystems - mangrove forests, tidal marshes, and seagrass meadows - are actions considered for increasing global carbon sequestration. To improve understanding of which management actions produce the greatest gains in sequestration, we used a spatially explicit model to compare carbon sequestration and its economic value over a broad spatial scale (2500 km of coastline in southeastern Australia) for four management scenarios: (1) Managed Retreat, (2) Managed Retreat Plus Levee Removal, (3) Erosion of High Risk Areas, (4) Erosion of Moderate to High Risk Areas. We found that carbon sequestration from avoiding erosion-related emissions (abatement) would far exceed sequestration from coastal restoration. If erosion were limited only to the areas with highest erosion risk, sequestration in the non-eroded area exceeded emissions by 4.2 million Mg CO₂ by 2100. However, losing blue carbon ecosystems in both moderate and high erosion risk areas would result in net emissions of 23.0 million Mg CO₂ by 2100. The removal of levees combined with managed retreat was the strategy that sequestered the most carbon. Across all time points, removal of levees increased sequestration by only an additional 1 to 3% compared to managed retreat alone. Compared to the baseline erosion scenario, the managed retreat scenario increased sequestration by 7.40 million Mg CO₂ by 2030, 8.69 million Mg CO₂ by 2050, and 16.6 million Mg CO₂ by 2100. Associated economic value followed the same patterns, with large potential value loss from erosion greater than potential gains from conserving or restoring ecosystems. This study quantifies the potential benefits of managed retreat and preventing erosion in existing blue carbon ecosystems to help meet climate change mitigation goals by reducing carbon emissions.