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Assumptions

  1. The calculator tool assumes no withdrawals or lapses before retirement age.
  2. The minimum withdrawal requirement is not modeled in this calculator.
  3. All final figures are expressed in tomorrow\'s dollars.
  4. All the growth rates are flat over years.
  5. Contributions are made at the beginning of each month. Charges/fees are determined based on beginning balance after monthly contributions and collected at the beginning of each month.
  6. The total retirement balance is as of the beginning of the retirement age.
  7. The inflation rate is 0.0%
  8. Retirement benefit payouts are at the beginning of each year.
  9. The annual dollar contribution amount (contribution rate applied to current salary) does not exceed $18,000 for participants over age 49 or under, or $24,000 for age 50 and over.
  10. The sum of the contribution amount and the employer match does not exceed $50,000 annually. (All cap limits are annual limits. In application, the model cap monthly cash flows by using 1/12 of these annual limits)
  11. If alternate plan starting age is below baseline plan, then it is assumed that those additional participants will have no current account balance, and have the same deferral rate as the existing participants.
  12. Consolidation scenario illustrates the effect on fund balance if participants consolidate their 401(k) assets that are currently with other plans. Two calculation methods are used here:
    % of Participants: Consolidated balance = Starting number of participant x Percentage of participant with other 401(k) assets x Average balance for other 401(k) asset
    % of Assets: Consolidated balance = Starting plan assets x Percentage of JH plan assets that participants are holding under other 401(k) plan
  13. Commissions are assumed to be collected monthly based on an annual brokerage fee rate.
  14. Payout assumption