401(k) Calculator: Calculate Your Match & Future Balance

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How to use this 401(k) calculator

• Based on your current age, income, any current 401(k) balance and current contributions, the calculator will estimate how much you’ll have in your 401(k) by retirement. 

• In the Basic fields, you can adjust your contribution amount (based on a percentage of your income), as well as employer contributions, your planned retirement age and your expected rate of return. 

• The employer match field refers to the percentage of your contribution your employer matches, and the limit on matching contributions is the maximum percentage of your salary matched. For example, many employers match 50% of your contributions, up to 6% of your salary.  

• The 401(k) calculator defaults to a 6% rate of return, which can be adjusted to reflect the expected annual return of your investments.

• In the Advanced fields, you can fill in additional fields, including your life expectancy and planned annual catch-up contributions. If you’re younger than 50, the calculator will begin factoring in the catch-up contribution amount when you turn age 50 and in the years following. The calculator also allows you to input your 401(k) fees if applicable, which will reduce your expected rate of return. 

• Your 401(k) balance at retirement is based on the factors you plug in to the calculator – your total planned annual contribution, your current age and retirement age and the rate of return. The 401(k) calculator assumes 2% annual income growth. There is no inflation assumption. 

• The 401(k) calculator displays two results: A projected retirement need and how much your 401(k) will contribute in income each month based on your current savings rate. If you hover over the graph, you’ll see your 401(k) balance broken down by contributions, employer match, catch-up contributions and investment growth.

More information about 401(k)s

A 401(k) is a retirement plan offered by some employers. These plans allow you to contribute directly from your paycheck, so they’re an easy and effective way to save and invest for retirement. There are two main types of 401(k)s:

• A traditional 401(k): This is the most common type of 401(k). Your contributions are made pre-tax, and they and your investment earnings grow tax-deferred. You’ll be taxed on distributions in retirement.

• A Roth 401(k): About half of employers who offer a 401(k) offer this variation. Your contributions are made after taxes, but distributions in retirement are not taxed as income. That means your investment earnings grow federally tax-free.

Why should you use a 401(k)?

Matching dollars, for one thing: The vast majority of employers that offer a 401(k) plan also kick in a company match, which means as you contribute, your employer will, too.

Commonly, that match will be worth 50% to 100% of your contributions, up to a limit that typically falls between 3% and 6% of your annual salary. If your employer offers up this free money, a good rule of thumb is to do everything you can to contribute enough to take advantage of it.

The other huge benefit of the 401(k) is that it allows you to put a lot of money away for retirement in a tax-advantaged way. The annual 401(k) contribution limit is $22,500 in 2023. Those ages 50 and up can contribute an extra $7,500.

What kind of investments are in a 401(k)?

401(k) accounts often offer a small, curated selection of mutual funds. That’s a good thing and a bad thing: On the plus side, you may have access to lower-cost versions of those specific funds, especially at very large companies that qualify for reduced pricing.

The downside is that even with discounted costs, that small selection narrows your investment options, and some of the funds offered may still have higher expense ratios than what you’d pay if you could shop among a longer list of options. That can make it harder to build a low-cost, diversified portfolio.

Some plans also charge administrative fees on top of fund expenses, which can add up and compound over time, effectively reducing your overall investment return. If your 401(k) is expensive, contribute enough to earn your company match, and then direct any additional retirement savings contributions for the year into an IRA.

Anything else to know about 401(k)s?

Yep. A few things, actually.

1. Once you contribute to a 401(k), you should consider that money locked up for retirement. In general, distributions prior to age 59½ will be hit with a 10% penalty and income taxes. If you do need to cash out your 401(k) before retirement, learn about the rules and the exceptions.

2. If you leave a job, you can roll your 401(k) into a new 401(k) or an IRA at an online brokerage or robo-advisor. The IRA can give you more control over your account and allow you to access a larger investment selection.

3. 401(k)s typically force you to begin taking distributions — called required minimum distributions, or RMDs — at a certain age. (In 2023, that age increased to 73.) You may be able to roll a Roth 401(k) into a Roth IRA to avoid RMDs.

Key investing definitions

Contribution limits: The IRS puts limits on the amount of money that can be contributed to 401(k)s and IRAs each year. These limits sometimes change from year to year.

Diversification: Spreading investment dollars across a range of assets (for example, stocks, bonds and cash) to cut down on your investment risk.

Hardship withdrawal: The IRS defines a hardship distribution as a withdrawal from your retirement account due to "an immediate and heavy financial need. This withdrawal is limited to the amount you need to meet that financial need. Learn more about cashing out your 401(k).

IRA: An individual retirement account is an investment account for retirement savings. Contributions may be tax-deductible, or withdrawals may be tax-free. You can generally contribute to both a 401(k) and an IRA. 

Mutual fund: An investment that pools money from many investors to buy assets such as stocks or bonds. Many 401(k) plans use mutual funds.

Portfolio: A collection of investment assets. A well-diversified portfolio might include assets such as stocks, bonds, exchange-traded funds and mutual funds.

Retirement age: The age you retire. Full Social Security benefits currently begin at age 66, but will rise to 67 for people born in 1960 and later. Early retirement benefits are available at 62, but at a lower monthly amount.

Return: The money you earn or lose from an investment.

Risk: The possibility that an investment will perform poorly or even cause you to lose money. In general, a low-risk investment will deliver lower potential returns and a high-risk investment may deliver higher returns, but may also cause you to lose your investment.

Robo-advisor: An automated investing service or online advisor. Robo-advisors use computer algorithms and software to create and manage investment portfolios, including IRAs. They're often less expensive than human financial advisors.

Tax-advantaged: Tax benefits offered by a retirement account. For example, you can make 401(k) contributions from your paycheck before tax is taken out. You don't pay taxes on those contributions or the earnings until you withdraw the money. In other accounts, such as Roth IRA, you can pay taxes on your contributions upfront, then withdraw your money tax-free in retirement.