401k Calculator — See How Your Paycheck and Retirement Grow
Calculate your 401k growth, employer match, tax savings, and paycheck impact. See the real cost of saving for retirement.
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401(k) Retirement Calculator
See your future savings, paycheck impact, tax benefits & employer match value — all in real time
Personal Details
Current Age 30
Retirement Age 65
Current 401(k) Balance
$
Annual Salary (Gross)
$
Contributions & Growth
Your Contribution Rate 6%
Employer Match Type
Match Rate
%
Up to % of Salary
%
Expected Annual Return 7%
Your Tax Bracket 22%
Monthly Contribution
$325
Employer Match / Year
$1,950
Total Annual Contribution
$5,850
Tax Savings / Year
$858
Monthly Paycheck Impact
Your 401(k) contribution is pre-tax, so your take-home pay doesn't drop by the full contribution amount.
Before 401(k)
$5,417
gross monthly pay
After 401(k)
$5,164
effective take-home
You Only Lose
$253
per month (after tax benefit)
Estimated Balance at Retirement
$1,247,580
At age 65 — after 35 years of tax-advantaged growth
+ $68,250 employer match total
+ $30,030 tax savings total
Portfolio Growth Over Time
With 401(k) — tax-advantaged + employer match
Without 401(k) — taxable savings only
With vs. Without 401(k)
With 401(k)
$1,247,580
Without 401(k)
$714,220
$533,360
You could have 75% more at retirement with a 401(k) — that's tax-deferred compounding plus free employer match!
401k Calculator Guide — Jump to Any Section ▼ Click to open
How 401k Works — Understanding Your Retirement Account
A 401k is one of the best tools for building retirement savings. Here is how it works and why you should use it.
What Is a 401k?
A 401k is a retirement savings account offered by your employer. You choose a percentage of your salary to put into the account. The money comes out of your paycheck before taxes are calculated. This means you pay less tax today.
Pre-Tax Contributions — How They Save You Money
When you contribute to a traditional 401k, your money goes in before taxes. This lowers your taxable income. If you earn $65,000 per year and contribute $5,000 to your 401k, you are only taxed on $60,000. If you are in the 22 percent tax bracket, you save $1,100 in federal taxes that year.
The money grows tax-free while it is in your account. You only pay taxes when you withdraw the money in retirement.
Employer Match — Free Money
Many employers offer a 401k match. This is free money for your retirement. The most common match is 50 percent of your contributions up to 6 percent of your salary.
Here is how that works. If you earn $60,000 per year and contribute 6 percent, you put in $3,600. Your employer adds 50 percent of that, which is $1,800. Total contributed to your 401k that year is $5,400. You only contributed $3,600, but your account gets $5,400. That is $1,800 of free money.
Investment Growth — How Your Money Grows
The money in your 401k is invested in stocks, bonds, or target-date funds. Over time, your investments grow. The average annual return of the stock market is about 7 to 10 percent. Thanks to compound interest, your money grows faster over time.
For example, if you have $10,000 in your 401k and earn 7 percent per year, you will have $19,672 after 10 years without adding another dollar.
Vesting — When the Match Becomes Yours
Some employers have a vesting schedule. This means the employer match is not fully yours until you work for the company for a certain number of years. Common vesting schedules are 3 years (cliff vesting) or 20 percent per year over 5 years (graded vesting). Your own contributions are always 100 percent yours.
Withdrawals in Retirement
You can start withdrawing from your 401k without penalty at age 59 and a half. The money you withdraw is taxed as regular income. If you withdraw before age 59 and a half, you pay a 10 percent penalty plus regular income tax.
A 401k helps you save for retirement, reduces your taxes today, and gives you free money from your employer. The more you contribute, the more you benefit. Use our calculator above to see how different contribution rates affect your paycheck and your retirement savings.
Real Example — 30-Year-Old Saving for Retirement
Let us walk through a real example. Meet Kevin. He is 30 years old and wants to retire at 65. He earns $60,000 per year and already has $10,000 in his 401k. Here is what happens when he starts contributing.
Kevin’s Situation
Current age: 30 years old
Retirement age: 65 years old
Years until retirement: 35 years
Current 401k balance: $10,000
Annual salary: $60,000
Contribution rate: 10 percent
Employer match: 50 percent up to 6 percent of salary
Expected annual return: 7 percent
Tax bracket: 22 percent
How Much Kevin Contributes Each Year
Kevin contributes 10 percent of his $60,000 salary. That is $6,000 per year or $500 per month.
His employer matches 50 percent of his contributions up to 6 percent of his salary. Six percent of $60,000 is $3,600. The employer matches 50 percent of that, which is $1,800 per year.
Total going into Kevin’s 401k each year is $6,000 from Kevin plus $1,800 from his employer. That is $7,800 per year.
What Happens to Kevin’s Paycheck
Kevin’s monthly contribution is $500. Because 401k contributions are pre-tax, his paycheck does not drop by the full $500. He saves $110 in federal taxes each month (22 percent of $500). His actual paycheck drops by only $390 per month. He saves $500 for retirement but only feels a $390 reduction in his take-home pay.
Kevin’s Tax Savings
Kevin contributes $6,000 per year to his 401k. His tax bracket is 22 percent. He saves $1,320 in federal taxes every year. That is $110 per month.
Kevin’s Retirement Savings Growth
Here is how Kevin’s money grows over 35 years with a 7 percent annual return.
At age 30, he starts with $10,000.
By age 40, after 10 years of contributions and growth, he will have approximately $120,000.
By age 50, after 20 years, he will have approximately $350,000.
By age 60, after 30 years, he will have approximately $780,000.
By age 65, after 35 years, he will have approximately $1,100,000.
The Power of Starting Early
If Kevin waited until age 40 to start saving, here is what would happen. He would have only 25 years to save instead of 35 years. His final amount at age 65 would be approximately $550,000 instead of $1,100,000. Starting 10 years earlier gives him twice as much money at retirement.
What If Kevin Increased His Contribution to 15 Percent?
If Kevin increased his contribution from 10 percent to 15 percent, he would contribute $9,000 per year. His employer match would stay at $1,800 (still 50 percent up to 6 percent). His total annual contribution would be $10,800. At age 65, he would have approximately $1,600,000. That is $500,000 more than the 10 percent scenario.
What If Kevin’s Employer Had No Match?
If Kevin’s employer offered no match, his total annual contribution would be only $6,000. At age 65, he would have approximately $850,000 instead of $1,100,000. The employer match gives him an extra $250,000 over 35 years.
Start saving as early as possible. Contribute at least enough to get the full employer match. Increase your contribution rate over time. Every dollar you save today grows into many dollars by retirement. Use our calculator above to see how your specific situation affects your retirement savings.
Traditional 401k vs Roth 401k — Which Is Better for You?
When you sign up for a 401k, you may have a choice between Traditional and Roth. Both help you save for retirement, but they work very differently. Here is what you need to know.
Traditional 401k — Pay Less Tax Now
With a Traditional 401k, your contributions come out of your paycheck before taxes. This lowers your taxable income today. You pay less tax now. The money grows tax-free while it is in your account. When you withdraw the money in retirement, you pay regular income tax on every dollar you take out.
Traditional 401k is best if you think your tax rate will be lower in retirement than it is today.
Roth 401k — Pay No Tax Later
With a Roth 401k, your contributions come out of your paycheck after taxes. You pay tax on the money now. The money grows tax-free while it is in your account. When you withdraw the money in retirement, you pay zero tax. Every dollar comes out tax-free.
Roth 401k is best if you think your tax rate will be higher in retirement than it is today.
Real Example — Traditional vs Roth
Let us compare Kevin, who earns $60,000 per year and contributes $5,000 to his 401k. He is in the 22 percent tax bracket.
With Traditional 401k: Kevin contributes $5,000 before taxes. His taxable income drops to $55,000. He saves $1,100 in taxes this year. At retirement, when he withdraws the $5,000 plus growth, he pays tax on every dollar.
With Roth 401k: Kevin contributes $5,000 after taxes. He pays $1,100 in taxes on that money this year. His taxable income stays at $60,000. At retirement, when he withdraws the $5,000 plus growth, he pays zero tax.
Which One Gives You More Money?
The answer depends on your tax rate now versus your tax rate in retirement.
If your tax rate is lower now than in retirement, Roth is better. You pay tax at a lower rate now and avoid higher taxes later.
If your tax rate is higher now than in retirement, Traditional is better. You save taxes at a higher rate now and pay lower taxes later.
If your tax rate is the same now and in retirement, both give you the same after-tax result.
When to Choose Traditional 401k
Choose Traditional if you are in a high tax bracket today, expect to be in a lower tax bracket in retirement, want to lower your current tax bill, or need the tax savings to afford contributing more.
When to Choose Roth 401k
Choose Roth if you are in a low tax bracket today, expect to be in a higher tax bracket in retirement, want tax-free income in retirement, or are early in your career with high growth potential.
What Many Experts Recommend
Many financial experts suggest having both Traditional and Roth accounts. This gives you flexibility in retirement. You can withdraw from your Traditional account when your tax rate is low and from your Roth account when your tax rate would be high.
Traditional saves you taxes now. Roth saves you taxes later. The best choice depends on your current tax rate, your expected future tax rate, and your retirement goals. Use our calculator above to see how different contribution amounts affect your paycheck and retirement savings.
Frequently Asked Questions — 401k
Here are answers to the most common questions people ask about 401k plans.
A 401k is a retirement savings account offered by your employer. You choose a percentage of your salary to contribute. The money comes out of your paycheck before taxes (Traditional) or after taxes (Roth). The money grows tax-free while invested. You can withdraw it penalty-free after age 59 and a half.
At minimum, contribute enough to get your full employer match. That is free money. A good goal is to contribute 10 to 15 percent of your salary. Increase your contribution by 1 percent every year until you reach this goal. For 2026, you can contribute up to $23,500. If you are 50 or older, you can contribute an additional $7,500.
Employer match is free money your employer adds to your 401k. The most common match is 50 percent of your contributions up to 6 percent of your salary. If you earn $60,000 and contribute 6 percent ($3,600), your employer adds $1,800. That is $1,800 of free money every year.
With a Traditional 401k, your contributions come out before taxes. This lowers your taxable income. If you earn $65,000 and contribute $5,000, you are only taxed on $60,000. If you are in the 22 percent tax bracket, you save $1,100 in federal taxes.
Vesting determines when the employer match becomes yours. Your own contributions are always 100 percent yours. Employer match may have a vesting schedule. Common schedules include cliff vesting (100 percent after 3 years) or graded vesting (20 percent per year over 5 years). If you leave before fully vesting, you lose some of the employer match.
The average annual return of the stock market is about 7 to 10 percent. A diversified portfolio of stocks and bonds typically returns 6 to 8 percent over the long term. Target-date funds adjust automatically based on your retirement year.
Choose Traditional if you are in a high tax bracket now and expect to be in a lower bracket in retirement. Choose Roth if you are in a low tax bracket now and expect to be in a higher bracket later. Many experts recommend having both for flexibility in retirement.
You have several options. Leave the money in your old employer's plan. Roll it over to your new employer's plan. Roll it over to an IRA. Cash it out (not recommended due to taxes and penalties). Rolling over to an IRA or new 401k keeps your money growing tax-free.
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