Financial Calculators
401K Calculator

401K Calculator

Free 401k retirement calculator that uses the 401k Growth Formula can help users plan for retirement and calculate 401k growth.



At the retirement age of 65, the 401(k) balance will be $1,537,963, which is equivalent to $546,566 in purchasing power today.

Self Contributions

Employer Match


Total contributions $516,720
Employee contributions $453,235
Employer match $63,485
Total interest $1,021,243
Total payouts $2,047,081
Withdrawing monthly $11,018 per month can be withdrawn in retirement until 85. At 65, this is equivalent to $3,916 in purchasing power today, and at 85, is equivalent to $2,168.
Withdrawing annually $134,087 per year can be withdrawn in retirement until 85. At 65, this is equivalent to $47,652 in purchasing power today, and at 85, is equivalent to $26,384.

There was an error with your calculation.

Table of Contents

  1. Leveraging a 401k for Retirement Savings
  2. Example
  3. The 401k Contribution Formula
  4. 401k Contribution Formula
  5. 401k Growth Formula
  6. Early Withdrawal Calculations
  7. How to Use the 401k Calculator
  8. (Optional) 401k Early Withdrawal Costs Calculator
  9. (Optional) Maximize Employer 401k Match Calculator
  10. Real Example
  11. Key Benefits and Helpful Tips
    1. Key Benefits:
    2. Helpful Tips:

401K Calculator

Leveraging a 401k for Retirement Savings

There are a lot of choices of retirement savings plans, including pensions, IRA (individual retirement account), and 401k. For citizens of the United States, a 401k is the most popular option available (similar versions may exist for non-US employers). These retirement accounts are available through an employer and come with many tax benefits. Employees can contribute pre-tax money to their accounts, increasing growth over time. Also, many employers will match (or partially match) their employees' contributions. Taking advantage of an employer match is a great way to boost your retirement savings without contributing your own money.


Steve currently saves 5% of his salary of $100,000 for retirement. He wants to increase his savings rate and decides to start participating in his employer's 401k program. Since Steve won't be paying taxes on these contributions, he can immediately increase the amount going into his retirement account. Also, his employer will match 50% of his contributions. Instead of saving $5,000 each year, his total contribution will now be $7,500, including his employer match.

When using a 401k to save for retirement, it's essential to ensure that your contributions will help you achieve your financial goals. A 401k investment calculator is a great way to test various retirement savings' scenarios to ensure you are on track to a comfortable retirement.

The 401k Contribution Formula

Calculating the growth of your 401k account works like most other retirement vehicles. The primary difference is that you must include the employer match in the calculation. The calculation can become quite complicated. Our 401k calculator will do all the hard work. But it's a good idea to understand how the formula works.

401k Contribution Formula

The formula to calculate 401k contributions (with an employer match) is:

$$TC = (S × ECP) + (S × MP)$$

  • TC = Total contribution
  • S = Employee pre-tax salary
  • ECP = Employee contribution percentage (in decimal format)
  • MP = Match percentage (in decimal format)

Note: Some employers will only match 401k contributions up to a certain amount. If you contribute a percentage exceeding what the employer will match, you need to factor this into your calculation. Fortunately, our 401k calculator does this automatically.

401k Growth Formula

Understanding the growth of your 401k investments over time is crucial for effective retirement planning. The formula provided offers a comprehensive method to calculate the future value (FV) of your 401k account by considering both the initial amount already in the account (PV) and the ongoing annual contributions (TC), along with the compound interest earned on these amounts.

Let's delve deeper into each component of the formula and how they work together:

$$FV = PV \times (1 + R)^n + TC \times \left[ \frac{(1 + R)^n - 1}{R} \right]$$

  • FV (Future Value): This represents the total amount you will have in your 401k at the end of n periods (years). It's the sum of what your current investments will grow to and what your future contributions will accumulate to, including interest.

  • PV (Present Value): The current balance in your 401k. This part of the formula, \$PV \times (1 + R)^n\$, calculates how much your existing funds will grow over n years, factoring in the compound interest. Compound interest means that interest in one period earns interest in subsequent periods, leading to exponential growth over time.

  • TC (Total Contributions): The amount of money you and possibly your employer contribute to your 401k each year. The TC part of the formula addresses these contributions. Since contributions are made regularly, each one has less time to earn interest than the previous ones. The formula \$TC \times \left[ \frac{(1 + R)^n - 1}{R} \right]\$ calculates the future value of these successive contributions considering compound interest.

  • R (Annual Interest Rate): The yearly rate at which your investment grows. This rate should be expressed as a decimal in the formula (for example, 5% becomes 0.05). It accounts for the investment returns your 401k might earn through its holdings, such as stocks, bonds, or mutual funds.

  • n (Number of Periods): The total number of periods, typically years, over which your 401k grows. The longer the time frame, the more significant the impact of compound interest on the growth of your 401k.

The formula's first part calculates the growth of your current 401k balance (PV) over n years with compound interest. The second part calculates the future value of a series of annual contributions (TC), each growing at the same rate (R) but for different lengths of time. Together, these components provide a holistic view of your 401k's expected growth, highlighting the powerful effect of compound interest and consistent investing over time.

This detailed approach allows you to more accurately forecast the future value of your retirement savings, helping you to make informed decisions about how much to contribute annually and assess whether you're on track to meet your retirement goals.

Early Withdrawal Calculations

401k accounts come with many tax benefits for the investor. The investor agrees not to withdraw money in exchange for tax-free growth. However, situations may arise where you need to withdraw money from your 401k. Early withdrawals are subject to penalties and taxes. It's essential to understand the cost of making these early withdrawals. Our 401 calculator helps calculate the cost of early withdrawals so you can make intelligent retirement planning decisions.

How to Use the 401k Calculator

The 401k retirement calculator is simple to use. You'll need some information about yourself and your finances to start. Some data points, such as your age and salary, are easy to find. However, other pieces of information may require an estimate or best guess (for example, you can't predict future inflation rates).

  • Step 1: Enter information into the left side of the calculator labeled “Basic Info”. This is where you will provide your current age, salary information, current 401k balance, contribution amount, and employee match.
  • Step 2: Populate the fields on the right side of the calculator labeled “Projections”. This information will help you determine how much your investments will grow and how long you can use your savings in retirement.
  • Step 3: Click "Calculate" and review the results. The results will provide you with the total anticipated value of your 401k, purchasing power after inflation, and how much you will be able to spend each year in retirement. You will also see a breakdown showing the total amount contributed, company matches, and growth.

(Optional) 401k Early Withdrawal Costs Calculator

This optional calculator helps users understand the tax and penalty impacts of taking early withdrawals from their 401k. This calculator option requires the withdrawal amount, tax rate information, and some general conditions (employment, disability, etc.) that could impact the calculation.

(Optional) Maximize Employer 401k Match Calculator

Employees should do their best to maximize the match that they earn from their employer. Because 401k accounts have contribution limits, you need to plan this carefully. This is especially critical if you have more than one employer with a 401k option. This calculator helps users determine the suitable contribution percentages to maximize their employer match.

Real Example

Let's say you just started a new job and want to take advantage of your employer's 401k match. You're 25 years old and have never had a 401k before. Your job pays $75,000 (with 3% anticipated annual raises). You decide to contribute 10% of your salary to your 401k each paycheck. Your employer will match 100% of your contribution up to 4%.

You plan to work until you are 60 years old and expect to need your retirement savings to last 30 years. Over the life of your investment, you believe you will earn a 10% return and expect inflation to remain constant at 3%.

To run this calculation, enter the following values into the 401k calculator:

  • Current Age: 25,
  • Current Annual Salary: $75,000,
  • Current 401k Balance: $0,
  • Contribution: 10%,
  • Employer Match: 100%,
  • Employer Match Limit: 4%,
  • Expected Retirement Age: 60,
  • Life Expectancy: 90 (30 years after your retirement date),
  • Expected Salary Increase: 3%,
  • Expected Annual Return: 10%,
  • Expected Inflation Rate: 3%.

Once you hit the Calculate button, you’ll see that your 401k balance at retirement will be approximately $3.9 million (equivalent to $1.4 million in today’s purchasing power).

Key Benefits and Helpful Tips

Leveraging a 401k can significantly improve your ability to save enough money for retirement. Here are some tips and tricks to make the most of our 401k matching calculator.

Key Benefits:

  • No Memorizing Formulas - Calculating the future value of a 401k requires complex formulas and many assumptions. A simple mistake could result in not saving enough money for retirement. Our calculator gives you the confidence that the figures presented are accurate without memorizing the formulas or doing manual calculations.
  • Inflation - Over time, inflation reduces the value of fiat currency. Many online calculators will show the future value of your 401k but won’t factor in this very critical detail. Our calculator lets you see how much your 401k will be worth in terms of today’s value.

Helpful Tips:

  • Yearly Review - The government limits the amount of money that can be contributed to a 401k in a given year (not including the employer match). Contributions that exceed this limit are penalized. This amount changes from time to time, so reviewing how much you contribute and if you are staying within limits is essential.
  • Experimentation - If you aren’t getting the results you want, try experimenting with different parameters. Perhaps you need to find an investment that will earn a little more interest. Or, maybe, you can increase your savings amount. Even small changes can make a big difference in the final results.