401k & Retirement Calculator

Most retirement projections obsess over the assumed rate of return. In practice, your savings rate has a bigger effect on the outcome — especially in the first 10–15 years. Saving 15% of a $70,000 salary at a 6% real return for 30 years produces roughly the same end balance as saving 8% at an 8% real return. The contribution rate is something you can control; the market return is not.

A common rule of thumb: save 15% of gross income (including any employer match) starting in your 20s, or 20%+ if you're starting in your 30s, or 25%+ in your 40s. Each decade you delay roughly doubles the contribution rate needed to reach the same retirement income.

If your employer offers a 401(k) match, the match is the highest-return component of your portfolio — typically a 50–100% instant return on the matched dollars. Always contribute at least enough to get the full match before allocating to anything else.

The 4% rule, derived from the 1998 Trinity Study, says that withdrawing 4% of your portfolio in year one and adjusting that dollar amount upward for inflation each subsequent year has historically supported a 30-year retirement with a high probability of success, using a 50/50 to 75/25 stock/bond allocation.

It is not a withdrawal cap that updates with the portfolio — the 4% applies once, at the start. If your $1M portfolio supports $40,000 in year one, you withdraw $40,000 × 1.03 = $41,200 in year two if inflation was 3%, regardless of what the portfolio did that year. This is the real source of the rule's resilience: spending doesn't spike when the market is up.

Recent research suggests 4% may be slightly aggressive in low-yield environments and slightly conservative if you're flexible about cutting spending in down years. A 3.5% starting rate is more conservative; 4.5% is more aggressive. The right number depends on how long you need the money to last and how willing you are to adjust spending mid-retirement.

401(k) up to the employer match — always first. The match is free money and the highest-return part of any retirement plan. After the match, the next dollar's home depends on your tax situation.

Roth IRA or Roth 401(k) — best when you expect to be in a higher tax bracket in retirement than today (early-career savers, anyone in a low-tax year). Contributions are taxed now; growth and withdrawals are tax-free.

Traditional 401(k)/IRA — best when you expect to be in a lower tax bracket in retirement than today (mid-career, peak earnings). Contributions reduce taxable income now; withdrawals are taxed as ordinary income later.

HSA (if you have an HDHP) — the only triple-tax-advantaged account: deductible going in, tax-free growth, and tax-free withdrawals for qualified medical expenses. After age 65, withdrawals for any purpose are taxed like a traditional IRA, which makes the HSA an excellent hidden retirement account.

Taxable brokerage — the catch-all after the above are maxed. No contribution limits, full liquidity, but no tax shelter on dividends and gains.

You're 35 years old, earn $80,000/year, and have $50,000 in your 401(k). You contribute 10% of salary ($8,000/year) and your employer matches 4% ($3,200/year). You assume 7% annual returns and 2% salary growth. Retirement age is 65 — 30 years of saving.

Year by year, your salary grows from $80K to roughly $144K by age 65. Your contributions rise with it. The employer match rises too. Over 30 years, you personally contribute about $324,000; your employer adds about $130,000. But investment growth does the heavy lifting: by age 65, the portfolio reaches approximately $1.84 million.

Using the 4% rule, that $1.84M supports roughly $73,600/year, or about $6,130/month, before taxes. Your total contributions were $454K; investment growth contributed the other $1.39 million. The key insight: starting at 35 with a 10% savings rate gets you there. Start at 45 and you'd need to save roughly 22% of salary to hit the same number.