- Annual salary
- This is your annual salary from your employer before
taxes and other benefit deductions. Since your
contribution and company match are based on the salary paid to you by your
employer, do not include any income you may receive from
sources other than your employer.
- Percent to contribute
- This is the percentage of your annual salary
you contribute to your 457 plan each year. This
calculator limits your contribution to 50% of your salary.
- Annual contribution limits
- Your total contribution for one year is
based on your annual salary times the percent you
contribute. However, your annual contribution is also subject to certain maximum
total contributions per year. The annual maximum for
2006 is $15,000. If you are over 50, a "catch-up" provision allows you to
contribute an additional $5,000 into your 457 account. It is
also important to note that employer contributions do not affect an employee's
maximum annual contribution limit. The table below lists
the maximum contributions and catch-up contributions for each year through 2006.
| Year |
Employee Contribution limit |
Additional "catch-up" contributions for workers 50+ |
| 2003 | $12,000 | $2,000 |
| 2004 | $13,000 | $3,000 |
| 2005 | $14,000 | $4,000 |
| 2006* and after | $15,000 | $5,000 |
Current age- Your current age.
- Age of retirement
- Age you wish to retire. This calculator assumes
that the year you retire you do not make any
contributions to your 457. So if you retire at age 65, your last contribution
happened when you were actually 64.
- Current 457 balance
- The starting balance or current amount you
have invested or saved in your 457.
- Annual rate of return
- The annual rate of return for your 457
account. This calculator assumes that your return is
compounded annually and your deposits are made monthly. The actual rate of
return is largely dependant on the type of investments you
select. From January 1970 to December 2005, the average compounded rate of
return for the S&P 500, including reinvestment of
dividends, was approximately 11.4% per year. During this period, the highest
12-month return was 61%, and the lowest was -39%. Savings
accounts at a bank pay as little as 1% or less.
It is important to remember
that future rates of return can't be predicted with
certainty and that investments that pay higher rates of return are subject to
higher risk and volatility. The actual rate of return on
investments can vary widely over time, especially for long-term investments.
This includes the potential loss of principal on your
investment. It is not possible to invest directly in an index and the
compounded rate of return noted above does not reflect
additional sales charges and fees that funds may charge.
- Employer match
- An employer match is in addition to your annual
contributions. It is based on a percentage of your annual
contributions. This range can be anywhere from 0% to 100%.
For example, let's assume the employer matches 50% of the employee's
contributions up to 6% of their salary. The employee earns
$100,000 per year and contributes 10%. The results would be:
- $10,000 from the employee
- $3,000 from the employer (which is 50% of $6,000 or 6% of the annual salary).
- Total: $13,000
Please read the definition for "Employer maximum" for a detailed description
of maximum employer matching contributions. It is
important to note employer contributions do not affect the maximum annual
deferral allowed to an employee. (The employee contribution
plus any employer match cannot exceed the maximum allowed deferral.)”
- Employer maximum
- This is the maximum percent of your salary
matched by your employer regardless of the amount you decide
to contribute. For example, let's assume your employer has a 50% match, up to a
maximum of 6% of your annual salary. If you have an
annual salary of $25,000 and contribute 6%, your annual contribution is $1500.
With a 50% match, your employer will add another $750 to
your 457 account. If you increase your contribution to 10%, your annual
contribution is $2500 per year. Your employer match, however,
is limited to the first 6% of your salary and remains at $750.
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