401(k) calculator
What should you keep in mind?
There are two types of 401(k) accounts: Traditional and Roth.
For Traditional 401(k) accounts, contributions are deducted from gross income or income BEFORE taxes. Employees are granted a tax deduction for that year and no taxes are paid on the contribution nor the earnings from the contributions until the retired employee withdraws it. There is, however, a 10 percent penalty fee for early withdrawals.
For Roth 401(k) accounts, contributions are taken from income AFTER income taxes are deducted, and there is no tax deduction for that year. There are no taxes to be paid when the retired employee withdraws it and only the earnings are penalized upon early withdrawals.