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401k Contribution Calculator
Calculate your estimated 401k savings growth based on your salary, contribution percentage, employer match, and years until retirement. Plan your retirement savings confidently with this easy-to-use calculator.
401k Contribution Calculator
Enter your financial details to see projected 401k savings at retirement.
Understanding Your 401(k) Contributions
A 401(k) is an employer-sponsored retirement savings plan that allows employees to contribute a portion of their pre-tax or after-tax wages to individual accounts. Named after Section 401(k) of the Internal Revenue Code, this plan has become one of the most popular retirement savings vehicles in the United States, helping millions of workers build a nest egg for their golden years.
When you contribute to a traditional 401(k), your contributions are made with pre-tax dollars, which reduces your current taxable income. You pay income taxes when you withdraw the money in retirement. With a Roth 401(k), contributions are made with after-tax dollars, meaning you pay taxes now but enjoy tax-free withdrawals in retirement, including all investment growth.
One of the most valuable features of a 401(k) is the employer match. Many employers match a percentage of your contributions, essentially giving you free money toward retirement. A common match formula is 50% of employee contributions up to 6% of salary. This means if you earn $75,000 and contribute at least 6% ($4,500), your employer adds an additional $2,250 per year to your account.
For 2026, the IRS allows employees under age 50 to contribute up to $23,500 per year to their 401(k). Workers aged 50 and older can take advantage of catch-up contributions, bringing their total limit to $31,000 ($23,500 + $7,500 catch-up). These limits apply only to employee elective deferrals and do not include employer contributions.
It is also important to understand vesting schedules. While your own contributions are always 100% vested (they belong to you immediately), employer matching contributions may follow a vesting schedule. Under a graded vesting schedule, you might earn 20% ownership per year of service, becoming fully vested after five or six years. A cliff vesting schedule grants 100% ownership after a set period, typically three years. If you leave your employer before you are fully vested, you forfeit the unvested portion of employer contributions.
How to Use This Calculator
Follow these steps to project your 401(k) retirement savings:
- Annual Salary ($): Enter your current gross annual salary before taxes and deductions. If your income varies, use your average expected annual earnings.
- Contribution Rate (%): Enter the percentage of your salary you plan to contribute each year. For example, entering 10 means you will defer 10% of your gross pay into your 401(k).
- Employer Match Rate (%): Enter the percentage your employer matches. For instance, if your employer matches 50 cents for every dollar you contribute, enter 50.
- Match Cap (%): Enter the maximum percentage of your salary that the employer match applies to. If your employer matches up to 6% of your salary, enter 6.
- Years Until Retirement: Enter the number of years you plan to keep contributing before you retire. A longer time horizon allows compound growth to work in your favor.
- Expected Annual Return (%): Enter the average annual rate of return you expect your investments to earn. The historical average for a diversified stock portfolio is approximately 7% after inflation.
After entering your values, the calculator will display your total employee contributions, total employer match, and projected 401(k) balance at retirement.
Formula Explained
Understanding how employer matching works is essential for maximizing your retirement savings. Here is a step-by-step example:
Example Scenario
Assume an annual salary of $75,000, an employee contribution rate of 10%, and an employer match of 50% up to 6% of salary.
$75,000 × 10% = $7,500 / year
Step 2 — Employer Match Calculation:
The employer matches 50% of contributions on the first 6% of salary.
Eligible salary portion: $75,000 × 6% = $4,500
Employer match: $4,500 × 50% = $2,250 / year
Step 3 — Total Annual 401(k) Contribution:
$7,500 (employee) + $2,250 (employer) = $9,750 / year
Each year, this combined $9,750 is invested and grows at your expected annual return. Over decades, compound interest turns these regular contributions into a substantial retirement fund.
Impact of Contribution Rate
The table below shows how different contribution rates on a $75,000 salary grow over time, assuming a 7% annual return and an employer match of 50% up to 6%.
| Contribution Rate | Annual Total | After 20 Years | After 30 Years | After 40 Years |
|---|---|---|---|---|
| 5% | $5,625 | $246,174 | $568,249 | $1,128,679 |
| 10% | $9,750 | $426,835 | $985,099 | $1,957,177 |
| 15% | $13,500 | $590,979 | $1,363,983 | $2,710,111 |
| 20% | $17,250 | $755,123 | $1,742,867 | $3,463,044 |
* Figures are approximate projections for illustrative purposes. Actual results depend on market conditions, fees, and contribution timing.
5 Ways to Maximize Your 401(k)
Always contribute at least enough to capture 100% of your employer match. Leaving match money on the table is equivalent to turning down a guaranteed return on your investment, often 50% to 100% on matched dollars.
Each time you receive a raise, bonus, or cost-of-living adjustment, increase your contribution rate by at least 1%. Gradual increases allow you to save more without significantly impacting your take-home pay.
High expense ratios erode returns over time. Opt for low-cost index funds or target-date funds with expense ratios below 0.20%. A difference of just 0.5% in fees can cost tens of thousands of dollars over a career.
Review and rebalance your asset allocation at least once per year. As markets move, your portfolio can drift from your target mix, exposing you to more risk than intended or reducing growth potential.
Withdrawing before age 59 and a half triggers a 10% early withdrawal penalty plus income taxes. The long-term cost of removing funds early is even greater when you account for lost compound growth over decades.
Scenario Comparison: Impact of 401(k) Contribution Rate on Retirement Savings
How different contribution rates on a $75,000 salary grow over 30 years at 7% return with a 50% employer match up to 6%.
| Contribution Rate | Your Annual | Employer Match | Value at 30 Years | Of Which Growth |
|---|---|---|---|---|
| 3% | $2,250 | $1,125 | $321,489 | $220,239 |
| 6% | $4,500 | $2,250 | $642,978 | $440,478 |
| 10% | $7,500 | $2,250 | $928,305 | $635,805 |
| 15% | $11,250 | $2,250 | $1,285,564 | $880,564 |
| Max ($23,000) | $23,000 | $2,250 | $2,402,956 | $1,646,456 |
Frequently Asked Questions
What is the 401(k) contribution limit for 2026?
For 2026, the IRS has set the employee elective deferral limit at $23,500 for workers under age 50. If you are 50 or older, you can make an additional catch-up contribution of $7,500, bringing your total limit to $31,000. These limits apply only to employee contributions and do not include employer matching contributions. The combined employee-plus-employer limit is $70,000 for those under 50 and $77,500 for those 50 and older.
What is an employer match?
An employer match is a contribution your employer makes to your 401(k) account based on the amount you contribute. For example, an employer might match 50% of your contributions up to 6% of your salary. If you earn $75,000 and contribute 6% ($4,500), your employer adds $2,250. This is essentially free money and represents an immediate 50% return on your contributed dollars, making it one of the best benefits available to employees.
Traditional vs Roth 401(k) — which should I choose?
A traditional 401(k) uses pre-tax dollars, reducing your taxable income now, with taxes due upon withdrawal in retirement. A Roth 401(k) uses after-tax dollars, meaning you pay taxes now but enjoy tax-free withdrawals later. Choose traditional if you expect to be in a lower tax bracket in retirement. Choose Roth if you expect your tax rate to stay the same or increase. Many advisors recommend contributing to both for tax diversification.
What happens if I withdraw from my 401(k) early?
Withdrawing funds from your 401(k) before age 59 and a half generally triggers a 10% early withdrawal penalty on top of regular federal and state income taxes. For example, a $10,000 early withdrawal could cost $1,000 in penalties plus $2,200 or more in taxes, leaving you with roughly $6,800. Some exceptions apply, including hardship withdrawals, disability, substantially equal periodic payments under Rule 72(t), and separation from service after age 55.
Should I max out my 401(k)?
Maxing out your 401(k) is an excellent goal if you can afford it, as it maximizes tax-advantaged growth. However, financial priorities differ. At minimum, contribute enough to get the full employer match. After that, consider paying off high-interest debt and building an emergency fund before increasing 401(k) contributions. If those are covered, increasing toward the maximum limit is one of the most effective ways to build retirement wealth.
What are 401(k) fees and how do they affect my savings?
401(k) plans typically include administrative fees, investment fund expense ratios, and sometimes individual service fees. Expense ratios range from 0.03% for low-cost index funds to over 1.5% for actively managed funds. Over a 30-year career, a 1% difference in fees on a $500,000 portfolio can cost over $150,000 in lost growth. Review your plan documents, choose low-cost funds, and ask your HR department about fee structures.
