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Estimated total
$322/mo
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401(k) & Roth projection
Traditional (401(k))
Roth
Projected at 65
$746,479
At a steady 7% average annual return.
In today's buying power
$265,286
Adjusted for 3% inflation - still real progress.
Every extra percent you add now adds up more than you'd think - and spending often looks different once you're actually retired, so treat this as a starting point for planning, not a verdict.
By Alex Diaz · How we calculate this
A 401(k) loan sounds simple - borrow against your own retirement money and pay yourself back - but the mechanics are stricter than they look. Most plans cap the loan at 50% of your vested balance, up to $50,000, and give you five years to repay it through automatic payroll deductions. Because it's still technically financed, just against your own balance instead of a bank's money, this calculator turns the loan amount, rate, and term you enter into a monthly payment and checks that against your income the same way it would for any other loan.
These key factors affect 401(k) loan affordability
How 401(k) loan repayment actually works
Most plans cap what you can borrow at 50% of your vested balance, up to a $50,000 ceiling, with up to five years to pay it back through automatic payroll deductions. The rate is usually fixed at prime plus one or two points, and here's the part that trips people up: the interest doesn't disappear into a bank's pocket, it goes back into your own account. That sounds like a wash, but it's not quite - that money would otherwise have been growing untouched in the market the whole time.
What happens if you leave your job
Leave your job - whether you quit, get laid off, or take a new offer - while a balance is outstanding, and the clock speeds up dramatically. Most plans give you only until the tax filing deadline for that year to pay off the rest. Miss that window and the remaining balance gets reclassified as a taxable distribution, plus a 10% early withdrawal penalty if you're under 59 1/2, on top of whatever income tax you already owe on it.
The cost of lost market growth
There's also a quieter cost most people don't think about: while the loan is outstanding, that borrowed money is sitting outside the market, not compounding. If your investments would have earned more than the loan's interest rate, you actually come out behind, even though you're technically paying yourself back. Worth knowing too - you repay a 401(k) loan with after-tax dollars, and then those same dollars get taxed again when you eventually withdraw them in retirement. That's a form of double taxation unique to this kind of loan.
How to use your results
- Compare the monthly payment to what you're already contributing - a large payroll deduction can force you to cut your own contributions and lose any employer match
- Think through your job stability before borrowing, since a sudden separation could turn the balance into an unexpected tax bill
- Use it only for costs you can't cover another way, since the loan is really borrowed against your own future retirement income
Ways to make a 401(k) loan more affordable
- Borrow less than the maximum allowed so a smaller balance is at risk if your job situation changes
- Choose the shortest term you can comfortably afford to limit how long the money is out of the market
- Keep contributing enough to get any employer match even while repaying the loan
- Build a separate emergency fund so you're not tempted to take a second 401(k) loan later
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Peer comparison data
Bureau of Labor Statistics (median income by age), Experian (credit score by age)
Used by the “how you compare” figures in the sidebar, not by the costs on this page.
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