401(k) Growth Calculator

The IRS increased 401(k) limits for 2026 per Notice 2025-67. The base elective deferral limit for 401(k), 403(b), and most 457(b) plans is $24,500 per year. Workers age 50 and older can contribute an additional $8,000 catch-up contribution for a total of $32,500. Workers aged 60 through 63 qualify for the new SECURE 2.0 super catch-up contribution — a total of $35,750 for 2026. SIMPLE IRA limits increased to $17,000 with a $4,000 catch-up for those 50 and older. These limits apply to your contributions only — employer match does not count toward your personal limit.

Employer matching is free money added to your 401(k) based on your own contribution. The most common matching formula is 100% match on the first 3% to 6% of your salary that you contribute — meaning if you contribute 6%, your employer adds another 6% of your salary. Some employers use a partial match — 50 cents for every dollar up to 6% of salary. Not contributing enough to capture your full employer match is effectively leaving part of your compensation unclaimed. Always contribute at least enough to capture the full employer match before directing savings elsewhere.

Both are employer-sponsored retirement accounts with identical contribution limits. The difference is timing of taxation. Traditional 401(k) contributions are pretax — they reduce your current taxable income and taxes are paid when you withdraw in retirement. Roth 401(k) contributions are after-tax — no current tax deduction but all growth and qualified withdrawals are completely tax-free. As of 2024 under SECURE 2.0, Roth 401(k)s no longer require RMDs — eliminating one of the key advantages Traditional 401(k)s previously had. Starting in 2026, workers earning over $150,000 in Social Security wages must make catch-up contributions as Roth.

In addition to the elective deferral limit ($24,500 base), the IRS sets a total annual addition limit that includes your contributions, employer match, employer nonelective contributions, and forfeitures. For 2026, the total annual addition limit is $70,000, or 100% of your compensation, whichever is less. This higher limit is relevant for business owners with Solo 401(k) plans or executives whose employer makes significant profit-sharing contributions in addition to matching.

The standard penalty-free withdrawal age for 401(k) funds is 59½. Withdrawals before 59½ generally incur a 10% early withdrawal penalty plus ordinary income tax. Exceptions include the Rule of 55 (penalty-free withdrawals if you leave your employer in or after the year you turn 55), substantially equal periodic payments (72(t) distributions), disability, death, qualified domestic relations orders, and certain medical expenses. Roth 401(k) contributions — not earnings — can be withdrawn penalty-free at any time, but converted amounts have their own five-year clocks.

The generally recommended order is: first, contribute to your 401(k) up to the employer match (free money). Second, max out an IRA or Roth IRA ($7,500 in 2026) if eligible — IRAs typically offer more investment options than employer plans. Third, return to the 401(k) and contribute up to the annual limit ($24,500). Finally, use taxable brokerage accounts for additional savings. If your 401(k) has poor investment options or high fees, maxing the IRA before additional 401(k) contributions may be preferable. High earners above Roth IRA income limits ($168,000 single in 2026) can use a backdoor Roth instead.