401(k) Savings Calculator
This 401(k) Savings Calculator allows you to examine the investment potential of a 401(k) account over a number of years. It not only lets you see how your investments would grow at a given rate of return, but also lets you take into account other variables that will determine the eventual size of your nest egg. It's fairly easy to determine the growth of an investment with a fixed rate of return and uniform contributions over a given number of years. But in the real world, 401(k)s don't act that way. Your rate of return is unpredictable. Your salary, and therefore your contributions and employer match will likely increase over time. You may delay or hasten your retirement date. The 401(k) Savings Calculator allows you to take all of those into account. While it's impossible to exactly predict the future, the calculator makes it easy to explore how variations in your rate of return and other factors will affect the growth of your investment, giving you a range of likely outcomes and letting you see what sort of changes can better help you meet your investment goals.
Financial Calculators from
401(k) Employee Savings Plan:
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401(k) Employer Match:
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401(k) Balance by Year
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Percent to contribute
This is the percentage of your annual salary you contribute to your 401(k) plan each year.
Your annual 401(k) contribution is subject to maximum limits established by the IRS. The annual maximum for 2019 is $19,000. A "catch-up" provision allows employees age 50 and older to contribute an additional $6,000 into their 401(k) account. Employer contributions do not count toward the IRS annual contribution limit.
Employees classified as "Highly Compensated" may be subject to additional limits based on their employer's overall 401(k) participation. If you expect your salary to be $125,000 or more in 2019 or was $120,000 or more in 2018, you may need to contact your employer to see if these additional contribution limits apply to you.
This is your annual salary from your employer, before taxes and other benefit deductions. Since your contribution and employer match are based on the salary paid to you by your employer, do not include any income you may receive from sources other than your employer.
Your current age.
Age at retirement
Age at which you plan to retire. This calculator assumes that the year you retire, you do not make any contributions to your 401(k). So if you retire at age 65, your last contribution occurs when you are actually 64.
Current 401(k) balance
The starting balance or current amount you have invested or saved in your 401(k).
Annual rate of return
The annual rate of return for your 401(k) account. This calculator assumes that your return is compounded annually and your deposits are made monthly. The actual rate of return is largely dependent on the types of investments you select. The Standard & Poor's 500® (S&P 500®) for the 10 years ending December 31st 2018, had an annual compounded rate of return of 12.1%, including reinvestment of dividends. From January 1, 1970 to December 31st 2018, the average annual compounded rate of return for the S&P 500®, including reinvestment of dividends, was approximately 10.2% (source: www.standardandpoors.com). Since 1970, the highest 12-month return was 61% (June 1982 through June 1983). The lowest 12-month return was -43% (March 2008 to March 2009). Savings accounts at a financial institution may pay as little as 0.25% or less but carry significantly lower risk of loss of principal balances.
It is important to remember that these scenarios are hypothetical and that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are generally subject to higher risk and volatility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment. It is not possible to invest directly in an index and the compounded rate of return noted above does not reflect sales charges and other fees that investment funds and/or investment companies may charge.
Annual salary increase
The annual percentage you expect your salary to increase. The calculator assumes that your salary will continue to increase at this rate until you retire.
The percentage of your annual 401(k) contributions your employer will match. These contributions are often capped. Please read the definition for "Employer maximum" for more information. Also note employer contributions do not count toward the IRS annual contribution limit.
Matching contributions can also be subject to a vesting schedule. See your plan information for details.
This is the maximum percent of your salary matched by your employer, regardless of the amount you decide to contribute.
For example, let's assume your employer provides a 50% match on the first 6% of your annual salary that you contribute to your 401(k). If you have an annual salary of $100,000 and contribute 6%, your contribution will be $6,000 and your employer's 50% match will be $3,000 ($6,000 x 50%), for a total of $9,000. If you only contribute 3%, your contribution will be $3,000 and your employer's 50% match will be $1,500, for a total of $4,500.
Now if you increase your contribution to 10%, your contribution will be $10,000, but your employer's 50% match is limited to just the first 6% of your salary. So it would remain $3,000, for a total 401(k) contribution of $13,000.
Using the 401(k) Savings Calculator
This calculator can help you with the following:
- Predicting the performance of your 401(k)
- Estimating how much you'll have available for retirement
- Figuring out how long you'll need to work and contribute to your account in order to retire comfortably
- See what the long-term impact would be of increasing or decreasing your contributions
- Gauging how a stronger- or weaker-than-expected rate of return will affect the long-term performance of your investments
- Determining how increased contributions due to regular raises in earnings and contributions will affect your 401(k)
To use it, you need to enter:
- The percentage of your salary that you contribute to your 401(k),
- Your current annual salary,
- Your expected annual salary increase,
- Your age,
- The age at which you plan to retire,
- The current balance in your 401(k),
- The expected annual rate of return for your 401(k),
- The percentage of your salary that your employer will provide as a matching contribution, and
- Your employer's contribution cap – i.e., the maximum percentage of your salary it will contribute, regardless of your own contribution.
If you have questions about any of these, you can click on the name of the field for more information.
The calculator will use these figures to determine how much you and your employer will contribute to your 401(k) over the years. Based on that, it will calculate how much your investments will earn between now and when you retire.
About 401(k) accounts
There are many different types of retirement savings accounts that you can use to prepare for your financial future. One of the most popular is the 401(k).
A 401(k) is what's known as a tax-preferred retirement account, one that offers certain tax advantages over regular savings or investing. In a traditional 401(k), your contributions are pre-tax – that is, any contributions you make up to a certain limit ($18,000 per year standard; up to $24,000 for those age 50 and older making "catch-up" contributions) are pre-tax; that is, they reduce your taxable income by the amount you contribute to the account.
Your earnings also grow tax-free, but the money you withdraw upon retirement is considered taxable income.
A second type is a Roth 401(k). With a Roth, you make your contributions in post-tax dollars; that is, your contributions to the account don't reduce your tax bill. However, your earnings grow tax-free and the money you take out at retirement is nontaxable as well.
The other thing that makes 401(k) plans very popular is that they often feature an employer match, where the employer kicks in a certain amount in addition to the employee's contribution. This is usually a certain proportion of the employee's own contribution, perhaps half or even equal to it, and is in addition to the employee's regular income.
Money in a 401(k) should be untouched until retirement. There is a 10 percent tax penalty on withdrawals from a traditional 401(k) before age 59 1/2; contributions to a Roth 401(k) can be withdrawn without penalty at any time, but there is a penalty on withdrawals of earnings prior to age 59 ½.
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