401(k) calculator

Project your 401(k) balance to retirement, and see the employer match for what it actually is: an instant, guaranteed return you can't get anywhere else.

How the math works

A 401(k) balance grows two ways at once. Each year the money already in the account compounds at your investment return, and each year you and your employer add more. The calculator runs it year by year until you retire.

The employer match is the part most calculators quote as a dollar figure and then forget about. It's set by a rate and a cap. A match of 50% up to 6% means the employer adds 50 cents for every dollar you put in, but only on the first 6% of your salary. In formula terms:

Read that second formula again, because it's the whole point of a 401(k) and the reason the account is worth prioritizing. A 50% match is a 50% return on the dollars you contribute, credited the day they land. The S&P 500's long-run average annual return is 10.2%. The match beats a good year in the market before your money has spent a single day invested.

Worked example

Take the standard match scenario: a worker earning $75,000 contributing 6% of salary — $4,500 a year — into a plan with a 50% match up to 6%. The employer adds $2,250. Total going in: $6,750 a year, of which a third is money the worker didn't earn by investing.

Run that for 30 years at the long-run real return of 7.0%, with no raises, and the balance lands near $637,610. The worker's own contributions over those years total $135,000. The employer's match totals $67,500. The rest — over $400,000 — is growth on both.

Now cut the contribution to 3% and keep everything else the same. The match falls to $1,125 a year, because the employer only matches what you put in. That's $1,125 of the worker's own compensation, declined annually. The account doesn't grow slower because the market changed. It grows slower because half the free money was left on the table.

When this calculator is wrong

Every 401(k) projection is a straight line drawn through a future that won't be straight. Three ways this one misleads:

• The match may not be yours yet. Employer contributions vest on a schedule. The legal maximums under ERISA are a 3-year cliff — nothing until year three, then all of it — or a graded schedule that reaches 20% after two years and rises 20 points a year to 100% after six. Leave before the schedule completes and you forfeit the unvested match. This calculator, like nearly all of them, assumes you're fully vested. If you might switch jobs in the next few years, the match line is optimistic. Your own contributions are always 100% yours.
• The return is an average, not a promise. The 7.0% real return is a long-run average across decades. The sequence matters as much as the average near retirement — a bad first decade and a bad last decade produce very different outcomes from the same headline rate.
• It ignores the contribution limit. The 2024 employee limit is $23,000, plus a $7,500 catch-up at age 50 and over. High contribution percentages on a high salary can exceed that; the projection doesn't cap them.
• It ignores fees. A plan stuffed with funds charging the active-fund average of 0.66% instead of an index option at 0.03% quietly reroutes a slice of every year's growth to the fund company. The match giveth; the expense ratio taketh.

What to do with the result

There's a fixed order of operations, and the match sets it. Contribute at least enough to capture the full employer match before you put a dollar anywhere else — not into a Roth IRA, not into extra debt payments beyond the minimum, not into a brokerage. A 50% match is a guaranteed 50% return; nothing else on the menu comes close. Turning it down to chase a 4.00% high-yield savings account, or even a 10.2% long-run stock return, is trading a certain 50% for an uncertain fraction of it.

Once the match is captured, the next dollar is a real decision — 401(k) versus IRA versus taxable — and the match no longer tips it, because past the cap your employer stops adding. Below the match cap, the answer is never ambiguous. Contribute up to it.

Common questions

How much should I contribute to my 401(k)?

At minimum, enough to get the full employer match — that's the one number with a clear right answer. On a $75,000 salary with a 50% match up to 6%, that's $4,500 a year to capture $2,250 in match. Beyond the match, how much more depends on your tax situation and other goals, which the match does not decide.

What does "50% match up to 6%" actually mean?

The employer adds 50 cents per dollar you contribute, but only on the first 6% of your salary. Contribute 6% and you get the full match. Contribute 3% and you get half of it. Contribute 10% and the match still stops at the 6% line — the extra 4% is unmatched.

Is the employer match really a 100% return?

It depends on the match rate. A dollar-for-dollar match (100 cents per dollar) is a 100% instant return. A 50% match is a 50% return. Either way it's credited immediately, before any market movement, which is why no ordinary investment competes with it.

What happens to the match if I leave my job?

You keep whatever has vested. Under the ERISA maximum graded schedule you're 20% vested after two years and fully vested after six; under a cliff schedule you get nothing until year three, then everything. Your own contributions are always fully vested. Check your plan's schedule before assuming the balance is entirely yours.

Should I contribute past the match?

Often yes, but it's no longer automatic. Past the cap, the employer stops adding, so the 401(k) is competing with an IRA and a taxable account on fees, fund selection, and tax treatment rather than on free money. The full match, by contrast, is never a close call.