Calculate 401k Contribution

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401(k) Contribution Calculator

e.g., 50 for 50% match
e.g., 6 for match on first 6% of salary
(e.g., $23,000 for 2024)
(e.g., $7,500 for 2024)

Your Estimated 401(k) Contributions

Your Annual Contribution: $0.00

Employer Annual Match: $0.00

Total Annual 401(k) Contribution: $0.00

Your Monthly Contribution: $0.00

Total Monthly 401(k) Contribution: $0.00

function calculate401k() { var annualSalary = parseFloat(document.getElementById('annualSalary').value); var employeeContributionRate = parseFloat(document.getElementById('employeeContributionRate').value); var employerMatchRate = parseFloat(document.getElementById('employerMatchRate').value); var employerMatchLimit = parseFloat(document.getElementById('employerMatchLimit').value); var irsContributionLimit = parseFloat(document.getElementById('irsContributionLimit').value); var catchUpContribution = parseFloat(document.getElementById('catchUpContribution').value); var age = parseInt(document.getElementById('age').value); // Input validation if (isNaN(annualSalary) || annualSalary <= 0) { alert('Please enter a valid annual salary.'); return; } if (isNaN(employeeContributionRate) || employeeContributionRate 100) { alert('Please enter a valid employee contribution rate (0-100%).'); return; } if (isNaN(employerMatchRate) || employerMatchRate 100) { alert('Please enter a valid employer match rate (0-100%).'); return; } if (isNaN(employerMatchLimit) || employerMatchLimit 100) { alert('Please enter a valid employer match limit (0-100% of salary).'); return; } if (isNaN(irsContributionLimit) || irsContributionLimit < 0) { alert('Please enter a valid IRS contribution limit.'); return; } if (isNaN(catchUpContribution) || catchUpContribution < 0) { alert('Please enter a valid catch-up contribution amount.'); return; } if (isNaN(age) || age = 50) { effectiveIrsLimit += catchUpContribution; } // 1. Calculate Employee Contribution var employeeContributionPreLimit = annualSalary * (employeeContributionRate / 100); var actualEmployeeContribution = Math.min(employeeContributionPreLimit, effectiveIrsLimit); // 2. Calculate Employer Match var maxSalaryPortionForMatch = annualSalary * (employerMatchLimit / 100); var eligibleEmployeeContributionForMatch = Math.min(actualEmployeeContribution, maxSalaryPortionForMatch); var employerMatchAmount = eligibleEmployeeContributionForMatch * (employerMatchRate / 100); // 3. Calculate Total Contribution var totalContribution = actualEmployeeContribution + employerMatchAmount; // 4. Calculate Monthly Contributions var monthlyEmployeeContribution = actualEmployeeContribution / 12; var monthlyTotalContribution = totalContribution / 12; // Display Results document.getElementById('employeeContributionResult').innerText = '$' + actualEmployeeContribution.toFixed(2); document.getElementById('employerMatchResult').innerText = '$' + employerMatchAmount.toFixed(2); document.getElementById('totalContributionResult').innerText = '$' + totalContribution.toFixed(2); document.getElementById('monthlyEmployeeContribution').innerText = '$' + monthlyEmployeeContribution.toFixed(2); document.getElementById('monthlyTotalContribution').innerText = '$' + monthlyTotalContribution.toFixed(2); } // Run calculation on page load with default values window.onload = calculate401k;

Understanding Your 401(k) Contributions

A 401(k) is a powerful, employer-sponsored retirement savings plan that allows employees to contribute a portion of their pre-tax salary to an investment account. These contributions grow tax-deferred until retirement, offering significant tax advantages and a structured way to save for your future.

Why Contribute to a 401(k)?

  • Tax Advantages: Contributions are typically made pre-tax, reducing your current taxable income. Earnings grow tax-deferred, meaning you don't pay taxes on investment gains until you withdraw them in retirement.
  • Employer Match: Many employers offer to match a percentage of your contributions, essentially providing "free money" for your retirement. This is one of the most compelling reasons to contribute at least enough to get the full match.
  • Compounding Growth: The money you invest, along with any employer match and investment earnings, grows over time. This compounding effect can significantly boost your retirement nest egg.
  • Convenience: Contributions are automatically deducted from your paycheck, making saving consistent and effortless.

How Our 401(k) Calculator Works

Our calculator helps you estimate your annual and monthly 401(k) contributions, including any potential employer match. Here's a breakdown of the inputs:

  • Annual Salary: Your gross annual income before any deductions.
  • Your Contribution Rate (%): The percentage of your salary you choose to contribute to your 401(k) each pay period.
  • Employer Match Rate (%): The percentage your employer contributes for every dollar you contribute. For example, a 50% match means your employer adds $0.50 for every $1 you put in.
  • Employer Match Limit (% of Salary): Employers often cap their match at a certain percentage of your salary. For instance, if the limit is 6%, your employer will only match contributions made on the first 6% of your salary, even if you contribute more.
  • IRS Employee Contribution Limit ($): The maximum amount you are allowed to contribute to your 401(k) in a given year, as set by the IRS. This limit can change annually (e.g., $23,000 for 2024).
  • Catch-Up Contribution (Age 50+) ($): If you are age 50 or older, the IRS allows you to contribute an additional amount beyond the standard limit. This is known as a catch-up contribution (e.g., $7,500 for 2024).
  • Your Age: Used to determine if you are eligible for catch-up contributions.

Example Calculation

Let's consider an example using the default values in the calculator:

  • Annual Salary: $75,000
  • Your Contribution Rate: 10%
  • Employer Match Rate: 50%
  • Employer Match Limit: 6% of salary
  • IRS Contribution Limit: $23,000
  • Catch-Up Contribution: $7,500
  • Your Age: 35

Here's how the calculation breaks down:

  1. Your Contribution: 10% of $75,000 = $7,500. Since this is below the $23,000 IRS limit (and you're under 50), your actual employee contribution is $7,500.
  2. Employer Match:
    • The employer matches on the first 6% of your salary: 6% of $75,000 = $4,500.
    • You contributed $7,500, but only $4,500 of that is eligible for the match.
    • Employer match amount: 50% of $4,500 = $2,250.
  3. Total Annual Contribution: Your $7,500 + Employer's $2,250 = $9,750.
  4. Monthly Contributions: Your $7,500 / 12 = $625.00. Total $9,750 / 12 = $812.50.

This example clearly shows how maximizing your employer match can significantly boost your retirement savings without requiring you to contribute more from your own pocket beyond the match limit.

Start Saving for Your Future

Understanding your 401(k) contributions is a crucial step in planning for a secure retirement. Use this calculator to experiment with different contribution rates and see the impact of your employer's match. The sooner you start saving, the more time your money has to grow!

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