How much should you contribute to a 403b?

A general guideline is to contribute between 10 percent and 15 percent of your salary, including the employer contribution. It's important to at least contribute enough to get the full employer match, as that represents an immediate return on your money. Ideally, you should also increase your contribution rate with each pay raise.

What is the maximum amount you can contribute to a 403 (b) in 2025?

In 2025 you can contribute up to $23,500 of your salary into a designated account. From age 50 and older, additional contributions are allowed in the amount of $7,500, with even higher limits for those between ages 60 and 63 for additional contributions. The total limit including employer contributions is $70,000.

How is the employer contribution calculated?

The employer matches the employee's contributions up to a certain maximum amount. If the match rate is 50 percent and the limit is 6 percent of pay, then the employer will contribute 50 cents for every dollar contributed by the employee, but only on the first 6 percent of pay. To receive the full matching contribution, the employee must contribute at least that percentage.

Is option (b) of 403 better than option (k) of 401?

There is not always a clear advantage for one option over the other. They are similar with similar contribution limits and tax rules. The main difference is in who offers them: A 403(b) plan is offered by nonprofits and government entities, while a 401(k) plan is offered by for-profit companies. When comparing, it's important to look at your employer's matching contributions, the fees, and each plan's investment product choices.

What return should you expect?

Use long-term, realistic numbers. Historically, the average annual return of a diversified stock portfolio has been about 7 percent to 10 percent before inflation, with returns in accounts with more bonds or retirement accounts generally lower. Using a more conservative number than your most optimistic estimate will lead to a more solid projection.

403(b) Calculator

Your 403(b) plan

Current age

Retirement age

Current annual salary

Percent of salary you contribute (%)

Current 403(b) balance

Expected annual rate of return (%)

Expected annual salary increase (%)

Add an employer match

Model the money your employer contributes to your 403(b).

Adjust for inflation

Show the projected balance in today's money.

Apply the annual IRS limit

Cap your yearly contribution at the 403(b) elective-deferral limit.

Projected balance at retirement

Your projected 403(b) balance at retirement is $921,052.1 — about 72.3% of that comes from investment growth over 35 years.

Balance at retirement

Years to retirement
Your total contributions: $

Investment growth: $
Total contributions in: $
Growth share of balance: %

Est. monthly income (4% rule): $

Your current balance more than doubles by the time you retire.

Charts and schedule

Show the composition pie

Split the balance into your money, employer match, and growth.

Show the growth chart

Plot the balance year by year to retirement.

Show the year-by-year schedule

A full table of each year's salary, contributions, and balance.

Where your balance comes from ($)

How your projected balance splits between your starting balance, your own contributions, employer match, and investment growth.

Year-by-year 403(b) projection
Age	Salary ($)	Your contribution ($)	Growth ($)	End balance ($)
31	50,000	5,000	350	10,350
32	51,000	5,100	724.5	16,174.5
33	52,020	5,202	1,132.22	22,508.72
34	53,060.4	5,306.04	1,575.61	29,390.37
35	54,121.61	5,412.16	2,057.33	36,859.85
36	55,204.04	5,520.4	2,580.19	44,960.45
37	56,308.12	5,630.81	3,147.23	53,738.49
38	57,434.28	5,743.43	3,761.69	63,243.61
39	58,582.97	5,858.3	4,427.05	73,528.96
40	59,754.63	5,975.46	5,147.03	84,651.45
41	60,949.72	6,094.97	5,925.6	96,672.02
42	62,168.72	6,216.87	6,767.04	109,655.94
43	63,412.09	6,341.21	7,675.92	123,673.06
44	64,680.33	6,468.03	8,657.11	138,798.21
45	65,973.94	6,597.39	9,715.87	155,111.48
46	67,293.42	6,729.34	10,857.8	172,698.62
47	68,639.29	6,863.93	12,088.9	191,651.46
48	70,012.07	7,001.21	13,415.6	212,068.26
49	71,412.31	7,141.23	14,844.78	234,054.27
50	72,840.56	7,284.06	16,383.8	257,722.13
51	74,297.37	7,429.74	18,040.55	283,192.41
52	75,783.32	7,578.33	19,823.47	310,594.22
53	77,298.98	7,729.9	21,741.6	340,065.71
54	78,844.96	7,884.5	23,804.6	371,754.81
55	80,421.86	8,042.19	26,022.84	405,819.83
56	82,030.3	8,203.03	28,407.39	442,430.25
57	83,670.91	8,367.09	30,970.12	481,767.45
58	85,344.32	8,534.43	33,723.72	524,025.61
59	87,051.21	8,705.12	36,681.79	569,412.52
60	88,792.23	8,879.22	39,858.88	618,150.62
61	90,568.08	9,056.81	43,270.54	670,477.97
62	92,379.44	9,237.94	46,933.46	726,649.37
63	94,227.03	9,422.7	50,865.46	786,937.53
64	96,111.57	9,611.16	55,085.63	851,634.32
65	98,033.8	9,803.38	59,614.4	921,052.1

The 403(b) calculator tool will predict how much your account balance will be when you retire. By entering your age, salary, contribution rate per pay period and expected return, the tool calculates annual contributions with compounding interest in mind. This calculation also takes into consideration employer matching, salary increases, inflation and IRS annual contribution limits. This gives you a more realistic prediction of how much wealth you will build over your career instead of a simplified, idealized formula.

What is a 403b plan?

A 403(b) plan is a tax-deferred retirement savings system available to employees of public schools, universities, hospitals, churches and other nonprofit organizations that are Section 501(c)(3) tax-exempt. It's similar to the 401(k) plan for profit-making companies. Contributions are deducted from gross pay, capital gains are tax-free annually, and income taxes aren't due until retirement withdrawals are made. Many plans also offer a Roth 403(b) option where contributions are made with after-tax money and qualified withdrawals are tax-free.

The 403(b) plan is primarily designed for teachers, nurses, college professors and employees of nonprofits or government agencies, so it's sometimes referred to as a tax-advantaged retirement savings account. The mechanism for building wealth is similar to other employer-sponsored retirement plans, and this calculator can be used for those plans in general.

How to use the calculator:

First enter the basic information: current age, planned retirement age, salary, personal savings rate to salary and current account balance. Then enter expected return and annual salary increase. This will calculate a projection of your retirement wealth, and in addition to the large total amount shown you can also see the breakdown of personal contributions, employer contributions and capital gains. You can use additional options if desired. If you enable the "Employer contribution" option, then employer contributions are taken into account. If you enable the "Inflation adjustment" option, then you can view your account balance in today's purchasing power terms. By applying the annual cap, you can ensure that high contributions do not exceed the personal contribution limits set by the IRS.

Forecast calculation method

The calculator first increases the account balance by the interest rate each year and then adds in the individual's and employer's contributions. Finally, it increases the salary that is used as a basis for the calculation in the following year according to the salary increase rate.

B_{\text{next}} = B \times (1 + r) + C_{\text{you}} + C_{\text{match}}

The individual's annual contribution is the amount determined by multiplying the salary by the contribution rate. The employer's matching contribution is calculated by multiplying the salary by the applicable contribution rate and the matching rate. The applicable contribution rate is the lesser of the individual contribution rate or the plan maximum.

C_{\text{you}} = S \times p \qquad C_{\text{match}} = S \times \min(p, L) \times m

where S is the salary, p is the personal contribution rate, L is the maximum matching rate as a fraction of salary, m is the matching rate, r is the annual interest rate and B is the balance carried forward. Suppose that the annual salary is 50,000, the personal contribution rate is 10 percent, the employer's matching rate is half of the personal contribution, and the cap is six percent of salary. The personal contribution is 5,000. Since the applicable contribution rate is the lesser of 10 and 6, it is 6 percent. This percentage is applied to the salary 50,000, with half contributed by the employer, so that the employer's contribution is 1,500. If the initial balance is 5,000 and the interest rate is 7 percent, then the account balance at the end of the first year is the result of 5,000 times 1.07, plus 6,500, which is 11,850.

The following table summarizes the individual input parameters and examples.

Symbol	Meaning	Example
S	Current annual salary	50,000
p	Percent of salary you contribute	10 percent
B	Current 403(b) balance	5,000
r	Expected annual rate of return	7 percent
m	Employer match rate	50 percent
L	Match limit as percent of salary	6 percent

Employer matching: extra funds you want to tap.

Not all 403(b) plans offer an employer match, but when it is available, this is usually the most effective part of the plan. A common condition is that for every dollar the person contributes, the employer will contribute 50 cents up to a maximum of 6 percent of salary. In such case, the person must contribute at least 6 percent of their salary themselves in order to receive the full employer match. If they do not contribute enough, they may miss out on employer funds. A calculator can be used to activate the employer match and enter the plan's contribution limits as well as a percentage of salary as an upper limit to see how much the employer match will add up over their career. Over decades this amount could become a significant portion of one's total contributions.

Contribution limit for year 2025.

The IRS sets a maximum amount that can be contributed annually to a 403(b). The personal contribution limit for the year 2025 is $23,500. Individuals who are age 50 or older may make additional contributions of up to $7,500. Additionally, individuals between the ages of 60 and 63 have a higher additional contribution limit. Some employees of certain institutions who have been employed there for an extended period of time may be able to claim additional contributions based on their years of service. The total maximum personal and employer contribution limit for the year 2025 is $70,000. As these limits are adjusted almost annually, this calculator can adjust the limits according to current regulations.

Differences between a 403b, 401k and 457b

403(b) and 401(k) are very similar, the main difference being in who offers them. A 403(b) plan is for non-profit organizations and public sector employers while a 401(k) plan is for private-sector companies. The contribution limits and basic tax treatment are the same. A 457(b) plan is common with state and local governments, has the same individual contribution limits as the other two but follows different rules. Often contributions can be made to both a 403(b) and a 457(b), which doubles your savings potential while still providing tax benefits. If multiple plans are available this combination can dramatically increase your savings.

Tips for realistic predictions

Don't use unrealistic optimistic assumptions, but sound return expectations. In the long term, the inflation-adjusted annual return of widely diversified stock indices is about 7 percent to 10 percent. This range can be used as a starting point, but if most of the account is held in bonds or annuities, it's advisable to use lower values. If the forecast period is long, activate the inflation calculation, because in some decades less can be bought for the same amount than today. Also check the forecasts again if your salary increases significantly or you change the savings rate. Even a slight increase can add up considerably over time through compound interest and make a big difference to retirement planning.

This calculator is for informational and planning purposes only and does not constitute financial or tax advice. Investment returns are not guaranteed, contribution limits and tax rates may change, and actual results will vary based on market performance, fees, and the terms of your particular plan. Please seek professional advice before deciding to open a retirement account.

Frequently asked questions

How much should you contribute to a 403b?: A general guideline is to contribute between 10 percent and 15 percent of your salary, including the employer contribution. It's important to at least contribute enough to get the full employer match, as that represents an immediate return on your money. Ideally, you should also increase your contribution rate with each pay raise.
What is the maximum amount you can contribute to a 403 (b) in 2025?: In 2025 you can contribute up to $23,500 of your salary into a designated account. From age 50 and older, additional contributions are allowed in the amount of $7,500, with even higher limits for those between ages 60 and 63 for additional contributions. The total limit including employer contributions is $70,000.
How is the employer contribution calculated?: The employer matches the employee's contributions up to a certain maximum amount. If the match rate is 50 percent and the limit is 6 percent of pay, then the employer will contribute 50 cents for every dollar contributed by the employee, but only on the first 6 percent of pay. To receive the full matching contribution, the employee must contribute at least that percentage.
Is option (b) of 403 better than option (k) of 401?: There is not always a clear advantage for one option over the other. They are similar with similar contribution limits and tax rules. The main difference is in who offers them: A 403(b) plan is offered by nonprofits and government entities, while a 401(k) plan is offered by for-profit companies. When comparing, it's important to look at your employer's matching contributions, the fees, and each plan's investment product choices.
What return should you expect?: Use long-term, realistic numbers. Historically, the average annual return of a diversified stock portfolio has been about 7 percent to 10 percent before inflation, with returns in accounts with more bonds or retirement accounts generally lower. Using a more conservative number than your most optimistic estimate will lead to a more solid projection.

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Disclaimer: This calculator is provided for general informational and educational purposes only. Our calculators are under active development, and results may be inaccurate, incomplete, or unsuitable for your situation. Always verify the figures independently and seek advice from a qualified professional before relying on them. We make no warranties and accept no liability for any loss or decision arising from use of this tool.

References

IRS: Retirement Topics - 403(b) Contribution Limits
Official IRS elective-deferral and combined contribution limits for 403(b) plans.
Investor.gov: 403(b) and 457(b) Plans
U.S. SEC explainer on how 403(b) plans work.