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Tools Index
There are several ways to manage your 401(k)
balance when you leave an employer. The most fundamental of which
is should you spend it or save it? Depending on your age and tax
bracket, making the wrong decision can cost you thousands of dollars
both in taxes and lost earnings. This calculator helps illustrate
the difference.
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Definitions
- Current age
- Your current age.
- Age of retirement
- Age you wish to retire. We calculate
the ending balance at retirement for each of your rollover
options.
- Federal income tax rate
- Consult the table below to determine
your federal tax bracket. If you are unsure, the calculator
will choose 27%. Please note that the calculator does
not factor in state taxes.
| Filing
Status and Income Tax Rates 2003
|
Tax
rate |
Married
filing jointly
or Qualified Widow(er) |
Single |
Head
of household |
Married
filing separately |
| 10% |
$0
- 12,000 |
$0
- 6,000 |
$0
- $10,000 |
$0
- 6,000 |
| 15%
|
$12,001-47,450 |
$6,001-28,400 |
$10,001-38,050 |
$6,001-23,725 |
| 27% |
$47,451-114,650 |
$28,401-68,800 |
$38,051-98,250 |
$23,726-57,325 |
| 30% |
$114,651-174,700 |
$68,801-143,500 |
$98,25-159,100 |
$57,326-87,350 |
| 35% |
$174,701-311,950 |
$143,501-311,950 |
$159,101-311,950 |
$87,351-155,975 |
| 38.6% |
over
$311,950 |
over
$311,950 |
over
$311,950 |
over
$155,975 |
- State income tax rate
- The current State marginal tax
rate you expect to pay on any additional income (or taxable
distributions).
- Current 401(k) balance
- The starting balance or current
amount you have invested or saved in your 401(k).
- Annual rate of return
- The annual rate of return for
your 401(k) account. Historically the major stock indexes
have averaged 10% to 12% per year. If you plan on withdrawing
your money within five years, you may wish to choose a
more conservative rate of return. This calculator assumes
that your return is compounded annually and there are
no new deposits to this account.
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