Individual 401(k) Contribution Comparison Calculator
- Business type
- PChoose the type of your business as Single Owner Corporation or Unincorporated Sole Proprietorship.
- Net income
- Enter your net income here. If this is an Unincorporated Sole Proprietorship, the net income is referred to the tax schedule C or C-EZ. If this is a Single Owner Corporation, the net income is referred to the w-2 wages.
- Current age
- Your current age. Your amount of 'Catch-up Contribution' in case of SIMPLE and Individual 401(k)s are dependent on your age.
- Offered rate of return
- Your anticipated rate of return from the accounts. As you are comparing the savings options, it is also important to consider their returns.
This is only a prediction of future account balances. The investments you select will be a determining factor in the actual rate of return. The annual compound rate for the S&P 500 for the ten years ending on the 31st of December 2012 was an average of 7.1% and included reinvestment of dividends. The S&P 500’s average annual compound rate of return from January of 1970 to the 31st of December 2012, with reinvestment of dividends included, were roughly 10.1% (source: www.standardandpoors.com). The highest return for a 12 month period since 1970 was 61% (for the months of June 1982 through June 1983). March 2008 through March 2009 rendered the lowest return of 43%. Although bank savings accounts can pay as little as or less than 0.25%, they carry a lower risk of loss of principle balances.The scenarios above are hypothetical, as the rates of return cannot be accurately forecasted for the future. As well, investments that yield higher rates of returns are subject to having a higher risk and volatility. Over time, particularly for long-term investments, the rate of return will vary greatly. The possible loss of principle on your investments should be considered. Other fees and sales charges may be required by investment or funds companies and are not indicated in the compound rate of return mentioned above, and a direct investment in an index is not possible.