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401(k) Calculator

Calculate your 401(k) retirement savings

Retirement Balance

$897,369

Contributions

$150,000

Employer Match

$75,000

Growth

$622,369

$
$
%

Common: 50% match up to 6% of salary

Retirement Balance

$897,369

at retirement

Contributions

$150,000

Employer Match

$75,000

Total Invested

$275,000

Growth

$622,369

Balance Growth Over Time

Final Balance Breakdown

Frequently Asked Questions

Q

How does a 401(k) work?

A 401(k) is an employer-sponsored retirement plan where you contribute pre-tax dollars from your paycheck. Your contributions lower your current taxable income, grow tax-deferred, and are taxed upon withdrawal in retirement. Many employers also match your contributions - essentially free money.

  • Pre-tax contributions reduce your current taxable income
  • Investments grow tax-deferred (no annual capital gains taxes)
  • Withdrawals in retirement are taxed as ordinary income
  • Employer matching is free money - always get the full match
  • Roth 401(k) option: after-tax contributions, tax-free withdrawals

Example: On $75,000 salary with 10% contribution, you save $7,500/year pre-tax. If your employer matches 50% up to 6%, they add $2,250 (50% of $4,500). Total annual 401(k) contribution: $9,750. After 30 years at 7% return, that's over $950,000.

Q

What is employer 401(k) match and how does it work?

Employer match is free money your employer contributes to your 401(k) based on your contributions. Common formulas: 50% match up to 6% of salary (effectively 3% free), 100% match up to 3% (3% free), or 100% up to 4% then 50% up to 6% (5% free). Always contribute enough to get the full match.

  • Not getting full match = leaving money on the table
  • Match is typically subject to vesting schedule (1-6 years)
  • Check your plan documents for exact match formula
  • Some employers match in company stock (consider diversifying)
Match FormulaYour ContributionEmployer AddsOn $80K Salary
50% up to 6%6% ($4,800)3% ($2,400)$7,200 total
100% up to 3%3% ($2,400)3% ($2,400)$4,800 total
100% up to 4%, 50% next 2%6% ($4,800)5% ($4,000)$8,800 total
Dollar-for-dollar up to 6%6% ($4,800)6% ($4,800)$9,600 total

Employer match provides 50-100% instant return on your money - no investment can beat that. If your employer matches 50% up to 6%, contribute at least 6% to get the full 3% free match. Missing the full match on $80K salary costs you $2,400/year in free money.

Q

How much should I contribute to my 401(k)?

Contribute at minimum enough to get full employer match (free money). Ideally, save 15-20% of income for retirement (including match). 2024 limits: $23,000 employee contribution ($30,500 if 50+). If you can't hit 15%, start with match and increase 1% annually with raises.

  • 2024 employee contribution limit: $23,000
  • Age 50+ catch-up contribution: Additional $7,500 ($30,500 total)
  • Total limit (employee + employer): $69,000 (2024)
  • Increase contribution 1% each year or with every raise
  • After 401(k) match, consider maxing IRA before more 401(k)
StrategyContributionPriority LevelWhen to Use
MinimumGet full matchEssentialIf budget is tight
Target10-15% of incomeRecommendedMost people
Aggressive15-20% of incomeIdealIf you can afford it
Maximum$23,000 (2024)OptimalHigher earners

A good order of operations: 1) Contribute to 401(k) up to full employer match, 2) Max out Roth IRA ($7,000/year), 3) Return to 401(k) and max it out, 4) HSA if eligible, 5) Taxable brokerage for additional savings.

Q

What is a good 401(k) return rate?

Historical stock market returns average 7-10% annually (10% nominal, 7% after inflation). A balanced 401(k) portfolio with 80% stocks/20% bonds typically returns 7-9%. Target-date funds automatically adjust allocation as you age. Expect volatility - some years gain 30%, others lose 20%.

  • Use 7% for conservative retirement projections
  • Past performance doesn't guarantee future returns
  • Lower expense ratios = higher returns (check fund costs)
  • Diversify across US stocks, international, and bonds
  • Don't panic sell during market downturns
Portfolio TypeExpected ReturnVolatilityBest For
100% Stock Funds9-10%HighYoung investors (30+ years)
80/20 Stocks/Bonds7-9%Medium-HighMost workers
60/40 Stocks/Bonds6-7%MediumNear retirement
Target-Date Fund7-9%AutomaticHands-off investors
Q

Traditional 401(k) vs Roth 401(k) - which is better?

Traditional 401(k): Pre-tax contributions, taxed at withdrawal. Better if you expect lower tax bracket in retirement. Roth 401(k): After-tax contributions, tax-free withdrawals. Better if you expect same or higher tax bracket later. Many experts recommend splitting contributions 50/50.

  • Young/early career: Often Roth is better (low tax bracket now)
  • Peak earning years: Often Traditional is better (high bracket now)
  • Tax diversification: Split between both for flexibility
  • Both have same contribution limits ($23,000 total in 2024)
FeatureTraditional 401(k)Roth 401(k)
Tax on contributionsPre-tax (reduces current income)After-tax (no current benefit)
Tax on withdrawalsTaxed as ordinary incomeTax-free (if qualified)
Best forHigher tax bracket nowLower tax bracket now
RMDs in retirementRequired at 73Required at 73 (can rollover to Roth IRA)

Nobody knows future tax rates. Having both Traditional and Roth balances gives you flexibility in retirement to minimize taxes. If your employer offers Roth 401(k), consider splitting contributions between Traditional and Roth.

Q

What happens to my 401(k) when I leave my job?

You have four options: 1) Leave it with former employer (if allowed), 2) Roll over to new employer's 401(k), 3) Roll over to IRA (most flexibility), 4) Cash out (avoid - 10% penalty + taxes if under 59½). Rollover to IRA is usually best for investment options and lower fees.

  • Rollover to IRA: Most investment choices, no taxes if done correctly
  • Roll to new 401(k): Keeps all retirement in one place, potential loan access
  • Leave with old employer: Simple, but may have limited investment options
  • Cash out: Worst option - 10% penalty + income taxes (lose 30-40%)
  • Direct rollover (trustee-to-trustee) avoids withholding
OptionProsConsBest When
Rollover to IRAMore choices, low feesNo 401(k) loansUsually best option
Roll to new 401(k)Consolidation, loan accessLimited to plan optionsNew plan has good funds
Leave with old employerNo action neededMay forget about itGood plan, planning to return
Cash outImmediate access30-40% lost to taxes/penaltiesAlmost never

Example Calculations

125-Year 401(k) with 50% Employer Match

Inputs

Current 401(k) Balance$50,000
Monthly Contribution$500
Employer Match50%
Expected Annual Return7%
Years to Retirement25

Result

Retirement Balance$897,369
Your Contributions$150,000
Employer Match Total$75,000
Total Invested$275,000
Investment Growth$622,369

Contributing $500/month with a 50% employer match ($250/month extra) at 7% return for 25 years, a $50,000 starting balance grows to $897,369. Of that total, $150,000 is your contributions, $75,000 is free money from employer matching, and $622,369 is investment growth.

230-Year 401(k) with 100% Employer Match

Inputs

Current 401(k) Balance$20,000
Monthly Contribution$750
Employer Match100%
Expected Annual Return8%
Years to Retirement30

Result

Retirement Balance$2,469,157
Your Contributions$270,000
Employer Match Total$270,000
Total Invested$560,000
Investment Growth$1,909,157

With $750/month and a dollar-for-dollar employer match ($750/month extra), 8% return, and 30 years of growth from a $20,000 starting balance, the 401(k) reaches $2,469,157. The employer match alone contributed $270,000, and investment growth added $1,909,157.

Formulas Used

401(k) Monthly Growth

Each month: Balance = (Balance + Contribution + Employer Match) x (1 + r/12)

Each month the employee contribution and employer match are added, then the total balance grows by the monthly return rate.

Where:

Balance= Current 401(k) account balance
Contribution= Employee monthly contribution
Employer Match= Contribution x (Match Percent / 100)
r= Annual expected return rate (as a decimal)

Investment Growth

Growth = Total Value - (Starting Balance + Total Contributions + Total Employer Match)

Investment growth is the portion of the final balance that came from compound returns, not from deposits.

Where:

Growth= Total returns from investment growth
Total Value= Final 401(k) balance at retirement
Starting Balance= Initial 401(k) balance
Total Contributions= Sum of all employee contributions
Total Employer Match= Sum of all employer matching contributions

Understanding 401(k) Retirement Plans

401(k) plans offer powerful tax-advantaged retirement savings with potential employer matching. The combination of pre-tax contributions, employer match, and decades of compound growth makes 401(k)s one of the best wealth-building tools available to employees.

Always contribute enough to get the full employer match - it's an instant 50-100% return on your money that no investment can beat. Missing your employer match on a $75,000 salary with 50% match up to 6% costs you $2,250 in free money every year.

Long-term compound growth makes consistent 401(k) contributions incredibly powerful. Contributing $750/month (10% of $90K salary) starting at 25 with 7% returns and 3% employer match yields over $2.5 million by age 65.

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Last Updated: Feb 12, 2026

This calculator is provided for informational and educational purposes only. Results are estimates and should not be considered professional financial, medical, legal, or other advice. Always consult a qualified professional before making important decisions. UseCalcPro is not responsible for any actions taken based on calculator results.

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