How Much Is 10% Retainage on a $600,000 Contract?
Retainage held at 10%
$60,000.00
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 amount600000 $
- Retainage10 %
- Work completed to date100 %
- Already paid to you0 $
Payable on this application$540,000.00
| Contract amount | $600,000.00 |
|---|---|
| Work completed | 100% |
| Earned to date | $600,000.00 |
| Retainage held at 10% | $60,000.00 |
| Less already paid | $0.00 |
| Due on this application | $540,000.00 |
| Retainage held at completion | $60,000.00chase 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% | $135,000.00 | $15,000.00 | $135,000.00 |
| 50% | $270,000.00 | $30,000.00 | $270,000.00 |
| 75% | $405,000.00 | $45,000.00 | $405,000.00 |
| 100% | $540,000.00 | $60,000.00 | $540,000.00 |
What else matters here
A $600,000 contract at 10 percent holds $60,000 and pays $540,000. At 75 percent complete, $45,000 is held and $405,000 has been paid.
The squeeze on a job this size is that retainage only runs in one direction. The supply house does not accept 90 percent of an invoice and wait for closeout, and payroll certainly does not. So material and labor are paid at one hundred cents on the dollar while the money coming in arrives at ninety, and the gap is funded by the contractor for the length of the job.
That is the argument for holding retainage from your own subcontractors at the same rate it is held from you, and for saying so in the subcontract in plain words before anyone starts. It is also the argument for negotiating the rate down at the front end on any contract heavy in purchased material, because on a job that is mostly material passing through, a ten percent holdback can exceed the entire margin on the work.
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 $600,000 contract?
$60,000 held and $540,000 payable, with $45,000 held at 75 percent complete.
Do suppliers accept retainage?
No. Material and labor are paid in full while your own applications are paid at ninety percent, and the contractor funds the gap for the length of the job.
Why does retainage hurt most on material heavy work?
Because the holdback is calculated on the whole contract while your margin sits on only part of it. On work that is mostly purchased material, ten percent can exceed the entire margin.
The retainage calculator takes any dimensions you like and hands back the same list.