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Understanding Your 403b Calculator and Terms

A 403b calculator lets you to compute how much money you can save in your 403b plan when your retirement comes. There are lots of 403b calculators nowadays, but they work in a rather similar manner and require rather similar pieces of information to be used in the computation.

General 403b calculator Definitions

Current Age in Years

This is your present age in years.

Anticipated Retirement Age in Years

This is the age in years you intend to retire.

Life Expectancy in Years

This is your life expectancy once you have reached your expected retirement age.

Current Amount in 403b Fund in US Dollars

On your 403b calculator, this is where you enter the amount in your account. If you have not yet started funding your 403b plan, then just enter zero.

Annual Contribution to 403b (Percentage of Your Salary)

This is how much you want to contribute, or are currently contributing, to your 403b plan expressed in terms of a specific percentage of your salary. The effect of decreasing or increasing your yearly contribution percentage will be seen on your 403b fund balance on your retirement.

Employer Match (Percentage of Contribution)

Majority of employers will match employee contributions to provide them benefits, and to encourage them to participate in the company’s program. If your employer does this, key in that percentage here. Otherwise, then enter zero.

Employer Maximum (Percentage of Salary)

Certain employers will only match up to a particular percentage of their workers’ salary. If your employer has a maximum that applies to their match, that amount goes here. Employer matches are currently limited at 6%.

Expected Annual Return on 403b Fund (Percentage)

This is your anticipated annual rate of return, which you intend to realize on your 403b fund from now to your retirement age.

403b Fund Growth Over Time (in US Dollars)

This is the computed rise in your 403b fund increase over time as you become older year after year. This series of numbers, which is affected by employee-employer matching and your inputted growth rate, and limits your contributions to what the law (2015) currently allows.

403b Fund Balance at Retirement (in US Dollars)

This will be your 403b fund at retirement age, if you make yearly contributions to the accounts and attain your expected rate of return, and your employer keeps matching funds at your indicated rate.

Salary at Retirement Age (US Dollars/ Year)

This is your predicted salary as you reach the retirement age you’ve specified previously.

Annual Income from 403b (US Dollars / Year)

This is the yearly retirement income your 403b account may be expected to provide you. Note that 403b withdrawals are taxable, and inflation will weaken the buying power of these dollars in the future.

Percentage of Final Pay

This is the portion of your salary as you reach retirement age that could be replaced by your 403b funds. All retirement income sources need to replace 70% to 80% of your final pay as a rule of thumb. A 403b calculator certainly comes in handy for this and all other related calculations.

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