Question 1

How much should I contribute to my 401(k)?

Accepted Answer

Financial experts recommend contributing at least enough to get your full employer match — that's free money. The general rule is to save 10-15% of your gross income for retirement (including employer contributions). In 2026, the maximum employee contribution is $24,500. Catch-up contributions for those 50+ add $8,000 (total $32,500), and ages 60–63 get an enhanced catch-up of $11,250 (total $35,750) under SECURE 2.0.

Question 2

What is an employer match and how does it work?

Accepted Answer

An employer match is when your company contributes money to your 401(k) based on your contributions. A common structure is "50% match up to 6%" — meaning if you contribute 6% of your salary, your employer adds another 3%. This is essentially free money and one of the best returns on investment available.

Question 3

What's the difference between Traditional and Roth 401(k)?

Accepted Answer

Traditional 401(k) contributions are pre-tax (reduce your taxable income now, pay taxes when you withdraw in retirement). Roth 401(k) contributions are after-tax (no tax break now, but withdrawals in retirement are tax-free). If you expect to be in a higher tax bracket in retirement, Roth may be better. If you expect a lower bracket, Traditional typically saves more.

Question 4

When can I withdraw from my 401(k) without penalty?

Accepted Answer

Generally, you can withdraw from your 401(k) without the 10% early withdrawal penalty at age 59½. Required Minimum Distributions (RMDs) begin at age 73. Some plans offer the "Rule of 55" — if you leave your employer at age 55 or later, you can withdraw from that employer's plan without penalty.

Question 5

How does compound growth affect my 401(k)?

Accepted Answer

Compound growth is the most powerful factor in retirement savings. Your investment earnings generate their own earnings over time. For example, $500/month invested at 7% annual return grows to approximately $566,000 in 30 years — but only $180,000 of that is your contributions. The remaining $386,000 comes from compound growth. Starting early is the single most impactful decision.

Question 6

What happens to my 401(k) if I change jobs?

Accepted Answer

You have several options: leave it with your former employer's plan, roll it over to your new employer's 401(k), roll it into a Traditional or Roth IRA, or cash it out (not recommended due to taxes and penalties). A rollover to an IRA often provides more investment options and lower fees.

Question 7

How much do I need to retire comfortably?

Accepted Answer

A common guideline is the 4% rule: you need 25 times your desired annual retirement income. If you want $60,000/year in retirement, you need approximately $1.5 million saved. However, this varies based on Social Security benefits, healthcare costs, lifestyle, and where you live. Our calculator factors in your specific situation to give a personalized estimate.

401(k) & Retirement Calculator

Personal Information

Contributions & Employer Match

Growth & Retirement Expenses

Monthly Retirement Income (4% Rule)

On Track for a Comfortable Retirement

Traditional vs Roth 401(k)

Year-by-Year Breakdown

401(k) & Retirement FAQ

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