How Much Is 10% Retainage on a $2 Million Contract?
Retainage held at 10%
$200,000.00
10% retainage, shown at 100% completion so the figure is the full amount held by the end of the job.
How that number is worked out
These are the figures this page was built with and every line the calculator produces from them. Change anything above and all of it moves.
- Contract amount2000000 $
- Retainage10 %
- Work completed to date100 %
- Already paid to you0 $
Payable on this application$1,800,000.00
| Contract amount | $2,000,000.00 |
|---|---|
| Work completed | 100% |
| Earned to date | $2,000,000.00 |
| Retainage held at 10% | $200,000.00 |
| Less already paid | $0.00 |
| Due on this application | $1,800,000.00 |
| Retainage held at completion | $200,000.00chase this at closeout |
Work completed compared
Retainage accumulates as the work does, so each progress application leaves a little more of your own money behind.
| Work completed | Payable on this application | Retainage held at 10% | Due on this application |
|---|---|---|---|
| 25% | $450,000.00 | $50,000.00 | $450,000.00 |
| 50% | $900,000.00 | $100,000.00 | $900,000.00 |
| 75% | $1,350,000.00 | $150,000.00 | $1,350,000.00 |
| 100% | $1,800,000.00 | $200,000.00 | $1,800,000.00 |
What else matters here
A $2 million contract at 10 percent holds $200,000 and pays $1,800,000. Halfway through the job $100,000 is already held.
At this scale the number that matters is not the holdback on one job, it is the total held across every contract running at once. Four jobs at this size overlapping puts most of a million dollars of earned money outside the business at the same time, and that peak is the figure a bank needs when it sizes a line of credit and the figure a surety looks at when it sets your limits.
Sureties treat retainage receivable carefully, because it is real money that cannot be spent and will not arrive on a predictable date. A contractor whose working capital is mostly retainage has less bonding capacity than the balance sheet total suggests, which in turn limits the size of the next job. Forecasting the peak by month, rather than discovering it, is what keeps the holdback from quietly capping how large the business can grow.
What this calculator assumes
- Retainage is money you have earned that is held back until the job closes out. It is not a discount and it is not a deposit.
- Most states cap retainage on public work, commonly at 5 or 10 percent, and several require it to be released or reduced at substantial completion. Private contracts are freer and often worse.
- Retainage is usually the last money a contractor sees and the first thing forgotten at closeout. Track it separately from the invoice balance.
Questions people ask
How much is 10 percent retainage on a $2 million contract?
$200,000 held and $1,800,000 payable, with $100,000 already held at the halfway point.
How does retainage affect bonding capacity?
A surety counts retainage receivable as money that cannot be spent and has no certain date, so working capital tied up in it reduces the size of the next job you can be bonded for.
What figure should I give my bank?
The peak total held across all jobs at once, forecast by month. One job's holdback understates the demand on the line of credit when several overlap.
The retainage calculator takes any dimensions you like and hands back the same list.