What this calculator does
Safe harbor is not one formula, it is three, and a plan must use exactly one of them to qualify. This calculator applies whichever design you select to your salary and deferral rate, and shows what you contribute, what your employer contributes, and the combined total.
The three prescribed designs
| Design | Employer contributes | Cap |
|---|---|---|
| Basic match | 100% of the first 3% deferred, then 50% of the next 2% deferred | 4% of pay, reached at a 5% deferral |
| Enhanced match | 100% of the first 4% deferred | 4% of pay, reached at a 4% deferral |
| Non-elective | 3% of pay to every eligible employee | Fixed at 3%; does not depend on deferral |
These are the only three designs that qualify a plan as safe harbor. A plan that is not safe harbor is free to use a different match altogether, including one with more tiers, a lower cap, or a vesting schedule, so do not assume one of these three applies without checking.
Worked examples
- Basic match, $75,000 salary, 5% deferral: you contribute $3,750. Your employer contributes 100% of the first 3% ($2,250) plus 50% of the next 2% ($750), for $3,000, which is 4% of pay. That 5% deferral is exactly the point at which the basic match maxes out.
- Basic match, $75,000 salary, 3% deferral: you contribute $2,250 and your employer matches it dollar for dollar, also $2,250, since the first 3% is matched at 100%. The combined total is $4,500, less than the 5%-deferral example above because the second matching tier is not reached yet.
- Enhanced match, $75,000 salary, 4% deferral: you contribute $3,000 and your employer matches all of it, also $3,000 (4% of pay), the enhanced design's cap.
- Non-elective, $75,000 salary, 0% deferral: you contribute nothing, but your employer still contributes $2,250, which is 3% of pay, because this design does not require you to defer anything at all.
Frequently asked questions
What is safe harbor, and why does the design matter?
A safe harbor 401(k) is a plan design that lets an employer skip the annual nondiscrimination testing ordinary 401(k) plans must pass. In exchange, the employer must commit in advance to one of three prescribed contribution formulas, funded at the stated rate, for every eligible employee. This calculator computes the contribution under whichever of the three designs you select. It does not decide which one your plan uses; that is set in the plan document.
What if my plan is not safe harbor at all?
Then it likely does not use any of these three formulas. A non-safe-harbor plan's match can be almost anything the employer designs, including tiers, caps or vesting schedules that do not resemble the basic or enhanced match here. Check your plan document or summary plan description for the actual formula rather than assuming one of these three applies.
Why does the employer amount stop increasing at a certain deferral?
Both matching designs are capped by law. The basic match caps at 4% of pay, reached once you defer 5%. The enhanced match also caps at 4% of pay, reached once you defer 4%. Deferring beyond that point still grows your own balance, just not the employer's contribution.
Why does non-elective pay out even at a 0% deferral?
That is the point of the design. Unlike a match, a non-elective contribution is not conditioned on the employee deferring anything. Every eligible employee gets 3% of pay, whether they contribute a dollar of their own or not.
Does this calculator apply an IRS deferral or income limit?
No. This tool applies only the safe harbor formula itself to the salary and deferral you enter. It does not cap your deferral at the IRS elective deferral limit or model the section 415(c) combined limit. For a projection that does apply those limits year by year, use the 401(k) projection calculator instead.
Is this tax or legal advice?
No. This is a calculation of the contribution formula only, for planning purposes. Confirm your plan's actual design against its plan document or with your plan administrator.
This calculator applies the safe harbor formulas only. It is not tax or legal advice, and it is not a substitute for your plan document.