401(k) Calculator

Start by contributing enough to capture your full employer match — that's free money equal to an instant 50–100% return. After that, a common guideline is to save 15% of gross income for retirement (including any employer match). If you started late, aim higher. The 2024 IRS contribution limit is $23,000 ($30,500 if you're 50 or older).

The S&P 500 has returned ~10% annually on average historically, but future returns aren't guaranteed. For planning, most financial advisors suggest 6–8% as a conservative estimate, accounting for inflation and fees. If you have a diversified mix of stocks and bonds, 7% is a reasonable middle-ground assumption.

Traditional 401(k) contributions are pre-tax (reduces taxable income now, but withdrawals are taxed in retirement). Roth 401(k) uses after-tax money (no deduction now, but withdrawals are tax-free in retirement). If you expect to be in a higher tax bracket in retirement, Roth wins. If you expect lower income in retirement, Traditional is better. Many advisors suggest splitting contributions between both.

An employer match is free money your employer adds to your 401(k) based on your own contributions. A common structure is '50% match on up to 6% of salary' — meaning if you earn $70,000 and contribute 6% ($4,200), your employer adds $2,100. Always contribute at least enough to get the full match before anything else.

You have four options: leave it with your former employer's plan (if allowed), roll it into your new employer's 401(k), roll it into an IRA (most flexible, widest investment choices), or cash it out (strongly discouraged — you'll owe income tax plus a 10% penalty if under 59½, potentially losing 30–40% of the balance).