How a 401(k) Calculator Works
A 401(k) growth calculator projects how your retirement balance compounds over time based on your contributions, employer match, expected investment return, and years until retirement. It runs year-by-year compounding on your growing balance, adding your contributions and employer match each year, then applying investment growth on the entire amount.
The most powerful insight from a 401(k) projection is the split between what you contribute, what your employer contributes, and what the market provides. In many cases, investment growth dwarfs both. A $80,000 salary worker contributing 10% ($8,000/year) with a 50% match on 6% (a $2,400 employer contribution), investing at 7% for 30 years from a $0 starting balance, ends up with approximately $860,000, of which $240,000 is personal contributions, $72,000 is employer match, and roughly $548,000 is investment growth. Time and compound growth drive the majority of the outcome, well ahead of the contribution rate.
2026 401(k) Contribution Limits
The IRS sets annual elective deferral limits on how much employees can contribute to their 401(k). The 2026 limits increased from 2025 due to inflation adjustments. SECURE 2.0 Act provisions also introduced a new "super catch-up" for workers in their early 60s, and a mandatory Roth catch-up rule for high earners that takes full effect in 2026.
* Source: IRS Notice 2025-67. The super catch-up replaces (does not add to) the standard $8,000 catch-up for ages 60–63. Compensation limit for 2026: $360,000.
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New in 2026: Roth catch-up requirement for high earners. Starting January 1, 2026, employees who earned more than $150,000 in FICA wages from the plan sponsor in the prior year (2025) must make all catch-up contributions (age 50+ or super catch-up) as Roth contributions. Regular deferrals up to $24,500 can still be pre-tax. If your plan lacks a Roth feature, catch-up contributions may be blocked entirely. Check with your HR department if you earn above the threshold.
How to Use This 401k Calculator
1
Enter your current details. Provide your current age, annual salary, existing 401(k) balance (enter 0 if starting fresh), and planned retirement age. The calculator auto-updates the 2026 IRS contribution limit hint based on your age.
2
Set your contribution rate and employer match. Enter your contribution as a percentage of salary. For the employer match, enter the match rate (e.g., 50 = 50 cents per dollar contributed) and the cap (e.g., 6 = up to 6% of salary). A common formula is 50% match up to 6% of salary, giving a maximum employer contribution of 3% of your salary.
3
Set your projections. Annual return represents your expected investment return. The long-run S&P 500 average is approximately 9.5% nominal or 7% after inflation. Salary growth compounds your contributions over time, 3% is a reasonable default for inflation-adjusted salary increases.
4
Review your results. The calculator shows your projected balance at retirement, split into personal contributions, employer match, and investment growth. The year-by-year chart and table let you see exactly when your balance reaches key milestones and how the growth component accelerates over time.
5
Use the Employer Match Optimizer tab. Switch to this tab to find the exact contribution percentage that captures your full employer match without triggering the IRS limit cutoff before December. If your contributions hit the annual limit before your last pay period, your employer may stop matching for the remainder of the year.
The Employer Match: Free Money You Should Never Leave Behind
An employer match is an immediate, guaranteed return on your contribution. A 100% match on the first 3% of salary (dollar for dollar) is a 100% return on those dollars before investment gains are even considered. No bond, CD, or savings account provides that. A 50% match on 6% of salary, the most common formula in the US, represents a 50% guaranteed return on the matched portion.
Failing to contribute enough to capture the full employer match is one of the most costly financial mistakes available to workers. On an $80,000 salary with a 50%/6% match, leaving the match uncaptured costs you $2,400 in free money per year, plus the compounding on that $2,400 over 30 years at 7%, which totals over $180,000 in foregone retirement savings.
The Match Limit Cutoff Problem
If your contribution rate causes you to hit the IRS annual limit ($24,500 for under-50 workers in 2026) before your last pay period of the year, your employer may stop matching for the remaining pay periods. This is the most common way workers inadvertently leave employer match on the table. The solution: spread your contributions evenly across all pay periods at a rate that reaches the IRS limit at or near your final December paycheck. Use the Employer Match Optimizer tab in the calculator above to identify the optimal rate for your pay schedule.
401(k) Growth: Traditional vs. Roth
Both traditional and Roth 401(k) plans have the same contribution limits and employer match rules. The difference is when taxes apply.
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Traditional vs. Roth: a simple rule of thumb. If your current marginal tax rate is higher than what you expect to pay in retirement, lean toward traditional pre-tax contributions, you defer taxes from a high rate now and pay at a lower rate later. If your tax rate in retirement will be similar to or higher than today (common for younger workers early in their careers), Roth contributions produce a better long-term outcome. Many financial planners recommend splitting between both during years of uncertainty.
Frequently Asked Questions
How much should I contribute to my 401(k)? −
The baseline answer: contribute at least enough to capture your full employer match. That match is a guaranteed return no other investment can beat. Beyond the match, the general guideline from most financial planners is to save 15% of your gross income for retirement, combining your contribution, employer match, and any other retirement savings. For someone starting at 25, 10–15% with consistent employer matching and 7% annual returns typically produces enough for retirement. Starting later requires a higher contribution rate to close the gap. Use the calculator above to project what your current contribution rate produces by retirement age.
What is the 401(k) contribution limit for 2026? −
The 2026 employee elective deferral limit is $24,500 for workers under 50, up from $23,500 in 2025 (IRS Notice 2025-67). Workers age 50 and over can contribute an additional $8,000 catch-up for a total of $32,500. A new SECURE 2.0 "super catch-up" applies to workers who turn 60, 61, 62, or 63 in 2026: they can contribute $11,250 instead of the standard $8,000, bringing their total to $35,750. The combined employee plus employer contribution limit is $72,000 in 2026 (up to $83,250 including the super catch-up). Also new in 2026: employees earning over $150,000 in prior-year FICA wages must make all catch-up contributions as Roth contributions.
How does a 401(k) employer match work? −
An employer match is a contribution your employer makes to your 401(k) that is tied to what you contribute. The most common formula is 50% of your contribution up to 6% of your salary. Under this formula, if you earn $70,000 and contribute 6% ($4,200), your employer adds 50% of that ($2,100), for a total annual contribution of $6,300. To get the full match, you must contribute at least 6% of salary. Contributing less than 6% leaves part of the match uncaptured. Contributing more than 6% does not increase the employer match under this formula. Always contribute at least enough to get the full employer match before directing savings elsewhere.
What is a 401(k) growth calculator used for? −
A 401(k) growth calculator projects your retirement account balance by compounding your contributions, employer match, and expected investment returns year by year from today to your planned retirement age. It shows the long-term impact of your current contribution rate, the value of your employer match over decades, and how much of your final balance comes from personal contributions versus investment growth. Most people are surprised to find that investment growth (compound returns) typically outweighs both personal contributions and employer match combined over a 25–30 year investment horizon. The calculator above also identifies your optimal contribution rate to avoid triggering the IRS limit before year-end and cutting off employer matching.
What is the 401(k) early withdrawal penalty? −
Withdrawing from a 401(k) before age 59½ triggers a 10% early withdrawal penalty on top of ordinary income tax. If you're in the 22% tax bracket, the total cost of an early withdrawal could reach 32% of the amount taken. The IRS allows penalty-free early withdrawals in specific circumstances: qualifying disability, death (paid to beneficiaries), separating from an employer at age 55 or older (the Rule of 55), substantially equal periodic payments under Rule 72(t), domestic relations orders, certain medical expenses, and a few other defined situations. The penalty only applies to the 10% surcharge; ordinary income tax applies regardless of age. Hardship withdrawals are taxed but may avoid the penalty in some plans.
When do I have to start taking 401(k) distributions? −
Required Minimum Distributions (RMDs) from traditional 401(k) accounts begin at age 73 under the SECURE 2.0 Act. The RMD amount each year is calculated by dividing your prior year-end account balance by an IRS life expectancy factor. Failing to take your RMD results in a 25% excise tax on the amount that should have been withdrawn (reduced from 50% by SECURE 2.0, and further reducible to 10% if corrected promptly). Roth 401(k) accounts no longer require RMDs during the account holder's lifetime starting in 2024, aligning them with Roth IRA treatment under a SECURE 2.0 change. If you're still working after 73, you can often delay RMDs from your current employer's plan until retirement.
