What's a vesting schedule?

Some employer match dollars don't immediately belong to you — they 'vest' over time (cliff vesting: nothing for X years, then 100%; or graded: 20% per year for 5 years). If you leave before fully vesting, you forfeit the unvested match. Plans must vest within 6 years per ERISA. Check your plan docs for the schedule. Vesting matters for job-change planning.

Should I contribute past the match?

Yes if (1) you've maxed out your match, AND (2) you have no high-interest debt (>~7%), AND (3) you have an emergency fund (3-6 months expenses). Tax-advantaged retirement contributions beyond the match still help — both 401(k) (tax-deferred) and Roth IRA (tax-free growth). Check the 401(k) annual limit (~$23,000 for 2025; rises annually) and the Roth IRA limit (~$7,000 + age-50 catch-up).

Should I do Roth 401(k) or Traditional 401(k)?

Depends on your tax situation now vs. retirement. Traditional: deduct now, pay taxes on withdrawals. Roth: pay taxes now, withdraw tax-free. If you expect to be in a higher tax bracket in retirement (early career, low current income): Roth wins. If you expect to be in a lower bracket (mid-late career, current high income): Traditional wins. Many people split between both for tax diversification. The match dollars themselves typically go into Traditional (employer's choice).

What's a 'true-up' provision?

Some employers calculate match per-paycheck (you must contribute every paycheck to get every paycheck's match); others 'true up' annually (catch-up the match at year-end if you front-loaded contributions). True-up is friendlier to people who max out early in the year. Check your plan summary.

Are there annual limits?

Yes — for 2025: $23,000 employee limit (your contributions), $69,000 combined limit (you + employer match + after-tax). 50+ catch-up adds $7,500. The IRS adjusts limits annually. The optimizer accounts for these (a high earner with high contribution % may hit the employee limit before the match cap).

What if my employer doesn't match?

Then there's no 'free money' to capture, but 401(k) contributions are still tax-advantaged. Many financial planners recommend prioritizing: (1) capture employer match (free money); (2) max out HSA if eligible; (3) max out Roth IRA; (4) max out 401(k). Without a match, the 401(k) drops below Roth IRA in priority for most people due to flexibility differences.

Money & Finance · Free tool

401(k) Match Optimizer

Find the contribution percentage that captures your full employer match without over-contributing. Instant online calculator — free, no sign-up needed.

Updated June 2026

Annual salary ($)Your contribution (%)Match rate (%)Match up to (% of salary)Catch-up eligible (50+)

Total per year

$5,100

Match left on table

$850

33% of max match missed

Your contribution	$3,400
Employer match	$1,700
Max possible employer match	$2,550
2026 contribution limit	$24,000

Increase your contribution to at least 6% to capture the full employer match.

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What it does

Calculate the optimal 401(k) contribution percentage to fully capture your employer’s match without contributing past the point where match dollars stop. Match dollars are literally free money — leaving them on the table is one of the most common (and costly) financial mistakes American workers make. The tool takes your salary and your employer’s match formula, and tells you the exact contribution % to capture every available match dollar.

Common employer match formulas:

100% of first 3%: contribute at least 3% to get the full match. Anything above 3% is unmatched.
50% of first 6%: contribute 6% to get a 3% employer match (50% of 6% = 3%). Common at larger companies.
100% of first 3%, 50% of next 2%: contribute 5% to get the full 4% match (3% × 100% + 2% × 50% = 4%). Tiered formulas are common.
Safe Harbor 3% non-elective: employer contributes 3% regardless of your contribution. Still participate to capture growth, but the match is independent of your % choice.

The math: find the contribution % at which one additional 1% of YOUR contribution stops earning ANY additional employer match. For 50%-of-first-6% match, that’s 6%. For 100%-of-first-3%, that’s 3%. Below that point, you’re leaving money behind. Above that point, additional contributions are still tax-advantaged but no longer matched.

A common mistake: contributing 10% to a 401(k) when your match formula caps at 6% means 4% of your contribution is unmatched. Those dollars are still tax-advantaged (great), but you could equivalently contribute 6% to the 401(k) and put the other 4% into a Roth IRA (more flexible, also tax-advantaged) or a taxable brokerage. The optimizer flags this scenario.

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How to use it

Enter your annual salary (gross, before tax).
Enter your employer's match formula. Common formats: '50% of first 6%', '100% of first 3%, 50% of next 2%', or use the formula builder for tiered formulas.
Read the output: optimal contribution % (the minimum to capture full match), total employer match dollars at that level, and your annual cost (your % × salary).
If you can afford more, contributing past the match cap is still tax-advantaged but consider whether a Roth IRA might be more flexible for those extra dollars.
Re-check annually: salary changes, match formula changes (some employers increase as a tenure benefit), and IRS limits change.

When to use this tool

Setting up your 401(k) for the first time at a new job.
Annual review — confirm your contribution still captures the full match (especially if you got a raise or the match formula changed).
Comparing job offers — the match percentage is a real component of total compensation.
Financial planning — know how much 'free' employer money you're collecting toward retirement annually.

When not to use it

Pension-style plans or other non-401(k) retirement structures — different math, different rules.
Roth 401(k) decisions specifically — the match math is the same; the Roth-vs-traditional decision is separate (use the roth-vs-traditional-breakeven tool).
When you have other competing financial priorities (high-interest debt, no emergency fund, no health insurance) — those typically come first. The optimizer assumes you've already covered basics.

Common use cases

Pre-decision sanity-check on inputs and outputs
Educational use — demonstrating the underlying concept
Onboarding a colleague who needs the same calculation/conversion
Verifying a number or output before passing it on

Frequently asked questions

What's a vesting schedule?: Some employer match dollars don't immediately belong to you — they 'vest' over time (cliff vesting: nothing for X years, then 100%; or graded: 20% per year for 5 years). If you leave before fully vesting, you forfeit the unvested match. Plans must vest within 6 years per ERISA. Check your plan docs for the schedule. Vesting matters for job-change planning.
Should I contribute past the match?: Yes if (1) you've maxed out your match, AND (2) you have no high-interest debt (>~7%), AND (3) you have an emergency fund (3-6 months expenses). Tax-advantaged retirement contributions beyond the match still help — both 401(k) (tax-deferred) and Roth IRA (tax-free growth). Check the 401(k) annual limit (~$23,000 for 2025; rises annually) and the Roth IRA limit (~$7,000 + age-50 catch-up).
Should I do Roth 401(k) or Traditional 401(k)?: Depends on your tax situation now vs. retirement. Traditional: deduct now, pay taxes on withdrawals. Roth: pay taxes now, withdraw tax-free. If you expect to be in a higher tax bracket in retirement (early career, low current income): Roth wins. If you expect to be in a lower bracket (mid-late career, current high income): Traditional wins. Many people split between both for tax diversification. The match dollars themselves typically go into Traditional (employer's choice).
What's a 'true-up' provision?: Some employers calculate match per-paycheck (you must contribute every paycheck to get every paycheck's match); others 'true up' annually (catch-up the match at year-end if you front-loaded contributions). True-up is friendlier to people who max out early in the year. Check your plan summary.
Are there annual limits?: Yes — for 2025: $23,000 employee limit (your contributions), $69,000 combined limit (you + employer match + after-tax). 50+ catch-up adds $7,500. The IRS adjusts limits annually. The optimizer accounts for these (a high earner with high contribution % may hit the employee limit before the match cap).
What if my employer doesn't match?: Then there's no 'free money' to capture, but 401(k) contributions are still tax-advantaged. Many financial planners recommend prioritizing: (1) capture employer match (free money); (2) max out HSA if eligible; (3) max out Roth IRA; (4) max out 401(k). Without a match, the 401(k) drops below Roth IRA in priority for most people due to flexibility differences.

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