401(k) Retirement Savings Calculator
Projects your 401(k) balance at retirement by modeling annual contributions, employer matching, salary growth, and investment returns year by year. Use it when optimizing how much to contribute to maximize your employer match and long-term wealth.
About this calculator
This calculator simulates your 401(k) balance by iterating year by year from your current age to retirement. Each year, your salary grows: salaryₙ = currentSalary × (1 + salaryGrowth%)^n. Your total contribution rate combines your own deferral and the employer match (capped at your contribution): totalRate = yourContribution% + min(employerMatch%, yourContribution%). The annual dollar contribution is salaryₙ × totalRate, which is added to the running balance and then compounded: balance = (balance + contributionₙ) × (1 + annualReturn%). This process repeats for every year until retirement. Employer matching is essentially a 50–100% instant return on contributed dollars, making it the highest-priority component of any retirement savings strategy.
How to use
Assume age 30, retiring at 65 (35 years), $60,000 salary, 6% contribution, 3% employer match, 7% return, 2% salary growth. Year 1: salary = $60,000; totalRate = 6% + 3% = 9%; contribution = $5,400; balance = (0 + $5,400) × 1.07 = $5,778. Year 2: salary = $61,200; contribution = $5,508; balance = ($5,778 + $5,508) × 1.07 = $12,076. This process repeats 35 times. The compounding of both salary growth and investment returns means the final balance grows dramatically in the last decade — a typical result might exceed $900,000 under these assumptions.
Frequently asked questions
How does employer 401(k) matching work and how do I maximize it?
Employer matching means your company contributes additional funds to your 401(k) based on your own contributions, up to a specified percentage of your salary. A common structure is a 100% match on the first 3% you contribute, meaning if you earn $60,000 and contribute 3% ($1,800), your employer adds another $1,800 for free. To maximize the match, you must contribute at least enough to capture the full employer percentage — not doing so is effectively leaving part of your compensation on the table. Always contribute at least up to the full match before directing savings elsewhere.
What annual return should I assume for my 401(k) projections?
A 6–7% nominal annual return is a commonly used assumption for a diversified portfolio of stocks and bonds over a long time horizon, based on historical U.S. market averages. The S&P 500 has averaged roughly 10% nominally, but most 401(k) portfolios are not 100% equities, and fees (expense ratios) reduce net returns. Inflation further reduces purchasing power, so a real return of 4–5% is often cited for planning purposes. Use conservative assumptions (6–7%) for retirement projections to avoid overestimating your future wealth; you can always revise upward if markets outperform.
How much should I contribute to my 401(k) each year?
At minimum, contribute enough to capture your full employer match — that is a 50–100% immediate return with no investment risk. Beyond that, the standard guidance is to save 15% of your gross income for retirement across all accounts combined, including the employer match. The 2024 IRS limit for employee 401(k) contributions is $23,000 ($30,500 if you are 50 or older). If 15% feels unachievable now, start with the match threshold and increase your deferral by 1% each year or whenever you receive a raise. Even small increases compounded over decades make a meaningful difference.