$23,500
2025 employee 401(k) contribution limit
$69,000
2025 combined employer + employee limit
4%
Most common employer match percentage
6%
Typical full-match contribution threshold
How the planner calculates your balance
The planner uses compound interest math applied to retirement accounts. Your current balance is the seed. Each year, your contributions are added, your employer match is applied, and the entire balance grows at your assumed annual return. This repeats for every year until your target retirement age, producing a year-by-year balance chart that shows the acceleration of growth as the account gets larger.
The employer match is effectively free money — a 4% match on a 6% contribution means your employer adds $1 for every $1.50 you contribute (up to the match ceiling). Missing the full match is one of the most expensive financial mistakes an employee can make, equivalent to turning down a portion of your compensation.
US 401(k) vs. Canadian RRSP
- 401(k): US employer-sponsored plan; 2025 limit $23,500 (+$7,500 catch-up over 50); employer match is common
- RRSP: Canadian individual plan; 2025 limit is 18% of prior year income up to $32,490; no employer match for the RRSP itself
- Both offer pre-tax contributions that reduce taxable income in the contribution year
- Both grow tax-deferred; withdrawals are taxed as ordinary income
- Both have penalties for early withdrawal (10% US; withholding tax plus income tax in Canada)
How to use the retirement planner
- Enter your current age and target retirement age
- Enter your current 401(k)/RRSP balance
- Enter your annual contribution amount or percentage of salary
- Add your employer match rate and threshold
- Set your assumed annual return (6–7% is a common conservative estimate)
- Review the projected balance and year-by-year growth chart
💡 Always capture the full match
If your employer matches 100% of contributions up to 4% of salary, contribute at least 4%. Contributing less is literally leaving part of your compensation on the table. This single action often adds tens of thousands of dollars to a retirement balance over a career.
Common mistakes to avoid
- Not contributing enough to capture the full employer match
- Using overly optimistic return assumptions (10%+) for planning purposes — 6–7% is more prudent
- Ignoring inflation — a $1.5M balance in 30 years may have the purchasing power of $800K today
- Cashing out a 401(k) when changing jobs — the penalty and tax hit can erase years of growth
- Investing only in money market or stable value funds — long-term inflation erodes low-return portfolios
Related calculators
The Roth IRA vs. Traditional IRA Calculator helps you decide whether pre-tax or post-tax contributions make more sense for your situation. The Compound Interest Calculator illustrates the growth mechanics behind retirement projections. And the Net Worth Calculator puts your growing retirement balance in the context of your total wealth picture.