Calculator assumptions

The calculators are illustrations, not financial or tax advice. They use 2026 figures and keep things simple on purpose. Here's everything they assume.

Everywhere

• Investment returns are steady every year. Real markets go up and down, and returns are never guaranteed.
• Fees aren't included.
• Your inputs are saved in your own browser (local storage) so they survive a refresh. They're never sent anywhere; "Reset to defaults" clears them.
• "Today's dollars" means after inflation. Nobody knows future inflation; 3% is roughly the long-run U.S. average.

1. Take-home pay

Federal

• 2026 federal brackets and standard deduction: $16,100 single, $32,200 married filing jointly (IRS Rev. Proc. 2025-32).
• No tax credits (like the child tax credit), itemized deductions, or other income.
• W-2 employee: income is wages from a job; you pay half of Social Security and Medicare.
• 1099 / LLC: a sole proprietor or single-member LLC taxed the default way. Self-employment tax is 15.3% on 92.35% of profit (Social Security up to $184,500, Medicare on all of it, plus 0.9% above $200,000 single / $250,000 married). Half of it is deducted from income for income tax. Pre-tax 401(k) and HSA money lowers income tax but not self-employment tax.
• S corp: you pay yourself a salary; payroll tax (your half and the company's half) applies only to the salary, and the rest of the profit comes out as distributions without Social Security or Medicare tax. The company's half is a business expense. You enter your salary and your distributions separately; the business's profit is the two together, plus the company's half of payroll tax and any Solo 401(k) employer contribution, since those are paid before distributions. The IRS requires a reasonable salary for the work you do, and an S corp adds costs (payroll, a separate tax return, possibly state fees) that aren't included.
• QBI deduction: 20% of qualified business income (1099 / LLC profit after half the self-employment tax and retirement contributions; S corp distributions, not salary), up to 20% of taxable income. Above $201,750 of taxable income (single) or $403,500 (married) it phases in over $75,000 / $150,000: service businesses (finance, consulting, law, health, and similar) phase out entirely, and other businesses are limited to 50% of the wages they pay. The $400 minimum deduction and the property-based limit aren't included. States don't use the QBI deduction.
• Solo 401(k): business owners use the same 401(k) options (pre-tax or Roth, and after-tax contributions converted to Roth). The employer contribution slider goes up to the maximum: 20% of net self-employment income (1099 / LLC) or 25% of salary (S corp), pre-tax, within each person's $72,000 total. It lowers income tax but not Social Security or Medicare tax.
• Other business deductions and expenses aren't included; enter profit after expenses.
• Social Security: 6.2% on wages up to $184,500. Medicare: 1.45%, plus 0.9% above $200,000 (single) or $250,000 (married).
• The HSA is funded through payroll, so it also avoids Social Security and Medicare tax. 401(k) contributions don't.
• Married couples: each spouse has their own income type and income. Social Security tax stops at each person's own $184,500 wage base; the 0.9% additional Medicare tax applies to combined earnings above $250,000. Each spouse with earnings has their own 401(k) limit, and each can have an IRA. The HSA uses the family limit.

Accounts and 2026 limits

• 401(k): $24,500 for pre-tax and Roth combined, split however you choose. Catch-up contributions for ages 50 and up aren't included.
• Mega backdoor Roth: assumes your plan allows after-tax contributions and converts them to Roth inside the plan. Your 401(k) contributions plus the mega backdoor can't exceed $72,000, or your pay if that's less (an S corp salary, or 1099 profit minus half the self-employment tax); "Max out" fills whatever room is left. Employer contributions also count toward the $72,000 but aren't included here, so your real room may be smaller.
• HSA: $4,400 for self-only coverage, $8,750 for family coverage ("Max out" uses family coverage for married couples).
• IRA: $7,500 per person. Direct Roth IRA contributions phase out between $153,000 and $168,000 of income (single) or $242,000 and $252,000 (married), measured after pre-tax 401(k) and HSA contributions.
• Backdoor Roth IRA: a non-deductible traditional IRA contribution converted to Roth. Assumes you have no other pre-tax IRA money, which would make part of the conversion taxable (the pro-rata rule).
• Taxable investing: a percentage of what's left after taxes, payroll saving, and the Roth IRA.

State

• Each state's 2026 brackets, standard deduction, personal exemption, and credits come from the Tax Foundation.
• Pre-tax 401(k) and HSA contributions lower state tax everywhere except: Massachusetts and Pennsylvania tax 401(k) contributions, and California and New Jersey tax HSA contributions.
• Massachusetts has no standard deduction. It uses a personal exemption ($4,400 single, $8,800 married) and lets you deduct up to $2,000 per person of Social Security and Medicare tax.
• Connecticut's personal exemption shrinks as income rises and is gone by about $45,000 (single).
• Not included: local income taxes (such as New York City, Maryland and Indiana counties, and many Ohio and Pennsylvania cities), other states' phase-outs of deductions and credits at higher incomes, and the few states that let you deduct federal tax.

Definitions

• Bracket: the tax rate on your next dollar of income.
• Effective tax rate: total tax divided by gross income.
• Savings rate: everything you save (401(k), HSA, IRAs, and other savings) divided by gross income, or by after-tax income (gross income minus all taxes).

Pre-tax or Roth?

• Compares your employee 401(k) contribution (or $24,500 if you haven't entered one) made pre-tax versus Roth, valued at your work-optional age in today's dollars, using the return and ages from step 2.
• The tax you save by going pre-tax is assumed to be invested at the same return, so both choices cost the same today. Taxes on that invested savings aren't included.
• Withdrawals are taxed at the federal bracket you choose for later plus your current state rate (none in states that tax 401(k) contributions, since you've already paid that tax). If the rate later equals today's, the two come out exactly even.
• Assumes today's tax rates stay in place. If rates rise, Roth looks better.

Roth or taxable?

• Compares the same after-tax dollars (your mega backdoor amount, or $20,000 a year) invested each year until your work-optional age, using the return, inflation, and ages from step 2. Results are in today's dollars.
• Taxable account: dividends are taxed every year and reinvested; 75% are qualified (taxed like long-term gains) and 25% are taxed as ordinary income. Remaining gains are taxed when you sell at the end.
• Rates: 2026 long-term capital gains brackets (0% up to $49,450 single / $98,900 married, 15% up to $545,500 / $613,700, 20% above), the 3.8% net investment income tax above $200,000 single / $250,000 married, and your state's top rate on your income. Today's rates are used for the whole period, including the final sale.
• Rebalancing uses a 50% relative band: an investment is only sold when it drifts 50% from its target. With steady returns that never happens, so no gains are realized before the end. Real markets occasionally would.
• The Roth is assumed to be withdrawn tax-free (held at least five years and taken after age 59½).

2. Your savings rate

• Uses your income and savings rate (of gross income) from step 1, invested monthly on top of what you've already saved.
• Everything is in today's dollars: the investment return you choose is adjusted for the inflation rate you choose (8% with 3% inflation is about 4.85% after inflation).
• Spending is what's left after taxes and saving in step 1 ("left to spend"). The 10%, 20%, and 30% comparisons use the same income and taxes with their own savings. Taxes owed on withdrawals from pre-tax accounts later aren't included yet.
• Once work is optional, you withdraw what you need (spending minus self-employed income) at the start of each year, rising with inflation, and the rest stays invested.
• Can spend: the most you could withdraw each year, rising with inflation, so the money lasts exactly to the age you plan for (100 by default).
• Lasts to: the age your savings run out at your current spending, or "100+" if they don't.
• "Plan to age" shows longevity risk: planning for a longer life lowers what you can safely spend each year.
• Returns are the same every year. Real returns vary, and a bad stretch early on matters more than one later.

3. The long game

• Uses your plan: what you've already saved (step 2), your total yearly savings from step 1 contributed monthly, and the years, return, and inflation from step 2.
• Contributions rise with inflation each year, so they stay the same in today's dollars. That's why "after inflation" at your return matches step 2 exactly.
• Your return is compared with 4%, 6%, 8%, and 10% (all before inflation), compounding monthly.

Also: pay down debt, or invest?

• Debt interest is charged monthly at the APR divided by 12.
• The minimum payment is made either way. Once the debt is paid off, the whole payment is invested.
• Paying off debt is a guaranteed return; the investment return is not.

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