401(k) Calculator

The 401(k) calculator projects how a workplace retirement account may grow between now and retirement. It combines your current balance, pre-tax salary deferrals, employer match, and expected annual return, then shows the estimated balance and after-tax value at withdrawal. Use it when deciding whether your contribution rate is high enough, whether you are receiving the full match, or how changing jobs and salaries may affect retirement savings.

How to use

1. Enter your annual salary and current 401(k) balance.
2. Set your current age and planned retirement age.
3. Enter the percent of salary you contribute before tax.
4. Add the employer match terms, such as a 50% match up to 6% of salary.
5. Choose an expected annual return and an estimated tax rate for retirement withdrawals.

The result updates immediately, so try a higher deferral rate or a larger match limit to see how much the change compounds. For a broader plan, compare the outcome with the compound interest calculator, then use the budget calculator to look for monthly cash flow that can fund the contribution.

How it works

A traditional 401(k) is funded with payroll deferrals before income tax. Your contribution is modeled as a percentage of salary. The employer match is calculated separately: the calculator looks at the smaller of your contribution rate and the plan’s match limit, then applies the employer match percentage to that eligible pay.

Those monthly employee and employer contributions are invested until retirement. The calculator assumes a steady annual return converted to a monthly rate and treats contributions as being added at the end of each month. The final balance is a projection, not a guarantee, because real markets, plan fees, salary changes, vesting schedules, and tax law all vary.

Formula

Monthly employee contribution:

$\text{employee monthly} = \frac{\text{salary} \times \text{contribution rate}}{12}$

Monthly employer match:

$\text{match monthly} = \frac{\text{salary} \times \min(\text{contribution rate}, \text{match limit}) \times \text{match rate}}{12}$

Projected balance:

$\text{balance} = \text{current balance}(1+i)^n + \text{monthly total} \times \frac{(1+i)^n - 1}{i}$

where (i) is the monthly return and (n) is the number of months to retirement.

Examples

Common mistakes

• Contributing below the match limit when the household budget could support a higher deferral.
• Treating the projected balance as spendable cash without considering income tax on traditional withdrawals.
• Using an expected return that ignores investment risk or plan fees.
• Forgetting to update the calculation after salary increases, job changes, or a new employer match formula.