IRA Calculator
Plan your path to a comfortable and secure retirement.
IRA Calculator
A Traditional IRA offers an upfront tax deduction on contributions and tax-deferred growth until withdrawal. This calculator shows how your IRA grows over time and what it'll be worth at retirement — after accounting for taxes on withdrawal.
How a Traditional IRA Works
Contribute pre-tax dollars (if eligible for deduction). Money grows tax-deferred — no tax on dividends, capital gains, or interest each year. At withdrawal in retirement, distributions are taxed as ordinary income. RMDs begin at age 73.
How to Use This Calculator
- Enter your current age and retirement age.
- Enter your current IRA balance.
- Enter your annual contribution (2025 limit: $7,000; $8,000 if 50+).
- Enter the expected annual return.
- Enter your expected tax rate in retirement.
- Click Calculate to see pre-tax and after-tax values at retirement.
2025 IRA Contribution Limits
- Under age 50: $7,000/year
- Age 50 and older: $8,000/year
- Deductibility: Depends on income and whether you have a workplace plan. Without a workplace plan, deduction is always available. With a plan: phase-out at $77,000–$87,000 (single) in 2025.
Example Calculation
Age 40, retire at 67 | Balance: $45,000 | Annual contribution: $7,000 | Return: 7% | Tax rate in retirement: 22%
- Pre-tax value at 67: ≈ $745,000
- After-tax value at 67: $745,000 × (1 − 0.22) = ≈ $580,500
- Tax savings on contributions over 27 years (at 24% current rate): ≈ $45,360
IRA Deduction Eligibility
- No workplace retirement plan: Full deduction at any income level.
- With workplace plan, single: Full deduction up to $77,000; partial $77K–$87K; no deduction above $87K.
- With workplace plan, married: Full deduction up to $123,000; partial $123K–$143K.
Common Mistakes to Avoid
- Contributing without knowing if it's deductible — Non-deductible contributions to a traditional IRA are often better made to a Roth IRA or via backdoor Roth conversion.
- Missing the deadline — You can contribute to an IRA for the prior tax year up until Tax Day (April 15). Don't miss this window.
- Ignoring RMDs — Failing to take required minimum distributions results in a 25% excise tax on the amount not withdrawn. See our RMD Calculator.
Frequently Asked Questions
Can I have an IRA and a 401(k)?
Yes — the limits are separate. However, having a 401(k) may limit your ability to deduct traditional IRA contributions based on your income. You can always contribute non-deductible, then convert (backdoor Roth).
What investments should I hold in a traditional IRA?
Since growth is tax-deferred anyway, place high-growth assets here — equities, REITs, high-dividend stocks. Keep tax-efficient investments (index funds, municipal bonds) in taxable accounts.
What is a SEP-IRA?
A Simplified Employee Pension IRA for self-employed individuals. Contribution limits are much higher (25% of net self-employment income, up to $69,000 in 2025).
Can I withdraw IRA funds early?
Yes, but distributions before age 59½ are subject to a 10% penalty plus income tax. Exceptions include first home purchase, qualified education expenses, disability, and substantially equal periodic payments (72(t)).
Conclusion
The traditional IRA is a powerful tool — especially if the deduction is available. Use this calculator to project your retirement balance, then compare it to a Roth IRA using our Roth IRA Calculator to pick the right account for your situation.
Related: Roth IRA Calculator | 401K Calculator | RMD Calculator | Retirement Calculator
Investment Wisdom
Don't wait! Starting your IRA just 10 years earlier can result in twice the final balance, even if you contribute the exact same total amount over your career.
