Roth IRA Calculator

A Roth IRA offers something incredibly valuable: tax-free growth for decades, plus tax-free withdrawals in retirement. This calculator shows exactly how much your Roth IRA will be worth — and compares it to a traditional IRA to help you choose the right account.

How a Roth IRA Works

You contribute after-tax dollars now. Your money grows tax-free inside the account. In retirement, all qualified withdrawals — including all the gains — are completely tax-free. There are no required minimum distributions during your lifetime.

How to Use This Calculator

1. Enter your current age and planned retirement age.
2. Enter your current Roth IRA balance.
3. Enter your annual contribution (2025 limit: $7,000; $8,000 if 50+).
4. Enter the expected annual return.
5. Enter your current and expected retirement tax rates for the Roth vs. traditional comparison.
6. Click Calculate to see tax-free value at retirement and after-tax comparison.

2025 Roth IRA Contribution Limits

• Under age 50: $7,000/year
• Age 50 and older: $8,000/year
• Income limits (2025): Phase-out begins at $150,000 (single) / $236,000 (married). Above $165,000 / $246,000: ineligible for direct contribution (backdoor Roth available).

Example: Roth vs. Traditional IRA

Age 30, contribute $7,000/year until 65, 7% return, 24% current tax rate, 22% retirement tax rate.

• Roth IRA at 65: ~$1,001,000 (fully tax-free)
• Traditional IRA at 65: ~$1,001,000 pre-tax → ~$780,780 after 22% tax
• Roth wins by ~$220,000 because tax rate at withdrawal is lower than at contribution

When Traditional IRA Is Better

If you're in a high tax bracket now (32%+) and expect to be in a much lower bracket in retirement, the traditional IRA's upfront deduction beats the Roth. The crossover depends on your specific tax situation.

Common Mistakes to Avoid

• Withdrawing contributions prematurely — Roth contributions (not earnings) can be withdrawn anytime tax-free. But withdrawing earnings before 59½ without a qualified exception triggers tax and 10% penalty.
• Missing the backdoor Roth — High earners above income limits can still contribute via backdoor Roth conversion. Consult a tax advisor.
• Not starting early — The Roth IRA is most powerful the longer the tax-free compounding has to work. Starting at 25 vs. 35 can mean $300,000+ more at retirement.
• Investing contributions in low-return funds — The Roth's tax-free feature is wasted in a money market fund. Invest aggressively for long-term growth.

Frequently Asked Questions

Can I have both a Roth IRA and a 401(k)?

Yes — and you should. The contribution limits are independent. You can max out both a 401(k) ($23,500) and a Roth IRA ($7,000) in the same year.

What is a Roth conversion?

Moving money from a traditional IRA to a Roth IRA. You pay income tax on the converted amount in the conversion year, but future growth is tax-free. Best done in low-income years (early retirement, sabbatical, business loss years).

Are there RMDs on a Roth IRA?

No. Unlike traditional IRAs and 401(k)s, Roth IRAs have no required minimum distributions during the owner's lifetime — making them excellent wealth transfer tools.

Can I contribute to a Roth IRA if I have no income?

Generally no — you need earned income at least equal to your contribution. Exception: spousal IRA allows a non-working spouse to contribute based on the working spouse's income.

Conclusion

For most young, middle-income earners, the Roth IRA is the best retirement savings tool available. Tax-free compounding for 30–40 years is a staggering benefit. Maximize contributions every year you're eligible and invest for long-term growth.

Related: IRA Calculator | 401K Calculator | Retirement Calculator | Investment Calculator