How Much Do I Need to Contribute Now?

Deciding how much to contribute to your employer-sponsored retirement Plan may have a significant impact on how much you accumulate in your account over time. As the table below illustrates, different contribution amounts can have a dramatic effect on how much you could potentially have in your account by the time you retire.

The most important thing is to start saving right away, because even waiting one year can make a big difference in the amount you could potentially have in your account when you retire.


Age 65
Age 65
Cost of
One year

FOR ILLUSTRATIVE PURPOSES ONLY. This hypothetical illustration is not intended as a projection or prediction of future investment results, nor is it intended as financial planning or investment advice. It assumes monthly contributions of $100, an annual 6% rate of return, retirement at age 65 and reinvestment of earnings with no withdrawals. The illustration does not reflect any associated charges, expenses or fees. The tax-deferred accumulation shown would be reduced if these fees were deducted. Rates of return may vary.

When you ask yourself how much you should save, the quick and easy answer is, "As much as you can." The following quick tips show that it may be more affordable than you think.

  • Before-tax paycheck contributions mean your take-home pay may not be affected as much as you think.
  • Before-tax savings have the potential to lower your current taxable income, and that means you may pay less income tax each year you make before-tax paycheck contributions.
  • Save as much as you can as soon as you can because the earlier you begin, the longer you'll have to benefit from potential tax-deferred growth and earnings.