RIVET calculates retainage automatically based on your project settings. Understanding the calculation helps you verify amounts and explain retainage to your team.
Pro Feature Required
Basic Retainage Formula
At its simplest, retainage is calculated as:
Retainage = Total Completed × Retainage Rate
Example
| Total Completed and Stored | $250,000 |
| Retainage Rate | 10% |
| Retainage Amount | $25,000 |
AIA G702 Line 5 Calculation
On the AIA G702, retainage appears in Line 5. This is the cumulative retainage on all work completed and materials stored to date (Line 4).
| Line | Description | Amount |
|---|---|---|
| Line 4 | Total Completed and Stored to Date | $250,000 |
| Line 5 | Retainage (10%) | $25,000 |
| Line 6 | Total Earned Less Retainage | $225,000 |
Cumulative Calculation
Different Rates for Work vs. Materials
Some contracts have different retainage rates for work completed versusmaterials stored. RIVET supports this:
Example: 10% on Work, 5% on Materials
| Category | Amount | Rate | Retainage |
|---|---|---|---|
| Work Completed | $200,000 | 10% | $20,000 |
| Materials Stored | $50,000 | 5% | $2,500 |
| Total | $250,000 | - | $22,500 |
Reduced Retainage After 50%
When your contract allows reduced retainage after reaching a milestone (typically 50%), the calculation becomes more complex.
How It Works
- Calculate retainage on work before the threshold at the original rate
- Calculate retainage on work after the threshold at the reduced rate
- Sum both amounts for total retainage
Example: 10% Reducing to 5% at 50%
On a $500,000 contract at 60% complete ($300,000):
| Portion | Amount | Rate | Retainage |
|---|---|---|---|
| First 50% ($250,000) | $250,000 | 10% | $25,000 |
| Next 10% ($50,000) | $50,000 | 5% | $2,500 |
| Total | $300,000 | - | $27,500 |
Effective Rate
Per-Line Item Retainage
On the G703, Column J shows retainage for each line item. RIVET calculates this using the same rules, applied per line:
| Item | Total (Col G) | % Complete | Retainage (Col J) |
|---|---|---|---|
| Rough-in Electrical | $50,000 | 100% | $5,000 |
| Panel Installation | $30,000 | 75% | $3,000 |
| Finish Trim | $10,000 | 25% | $1,000 |
| Total | $90,000 | - | $9,000 |
Configuring Retainage in RIVET
Project Settings
Set up retainage when creating a project or in project settings:
- Navigate to your project
- Open Settings
- Find the Retainage section
- Configure your rates and rules
Available Options
- Retainage Rate - Primary rate (e.g., 10%)
- Materials Rate - Rate for stored materials (if different)
- Reduced Rate - Rate after threshold (e.g., 5%)
- Threshold - When reduced rate applies (e.g., 50%)
Set Early
Common Calculation Issues
Rounding Differences
Manual calculations often have small rounding differences from RIVET. RIVET uses precise decimal calculations and rounds only in the final display.
Materials Not Included
If your retainage seems low, verify whether materials stored are being included in the calculation per your contract.
Reduced Rate Not Applied
If you've passed 50% but still see the full rate, check that reduced retainage is configured in your project settings.
Next Steps
- Learn about the release process
- See how retainage syncs to accounting
Need Help?
If you have questions about retainage calculations or need assistance, contact our support team at support@slpwlk.io.