Retainage is money a contractor has already earned but won’t see until substantial completion — a cash-flow cost distinct from any lending calculator on this site.
How it works
A percentage of each invoiced progress payment is withheld as retainage, protecting the project owner against unfinished or defective work. The remainder is paid now; the retainage accumulates until release at substantial completion.
What this does not include
Many contracts step the retainage rate down (e.g. from 10% to 5%) once the project reaches 50% completion — this calculator applies whatever single rate is entered for a given invoice rather than tracking a stepped schedule automatically.
How to use this calculator
- Enter the invoiced amount for this payment period.
- Enter the retainage rate specified in the contract.
Frequently asked questions
When is retainage released?
Typically at substantial completion or after a defined warranty/punch-list period, per the specific contract terms — timing varies significantly by project and jurisdiction.
Does retainage apply to subcontractors too?
Often yes — a general contractor commonly withholds a similar percentage from subcontractor payments, mirroring what the owner withholds from the general contractor.
Can retainage rates vary by state?
Yes — several states cap retainage rates or set specific release timelines by statute, particularly on public projects.
