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Roth IRA calculator

Project tax-free Roth IRA growth and compare to a traditional IRA after-tax.

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About this calculator

A Roth IRA is an individual retirement account with after-tax contributions and tax-free withdrawals in retirement (including all growth). Income limits cap eligibility, but for most middle-income earners the Roth IRA is the second-best retirement vehicle after the employer 401(k) match.

Contribution limits (2024)

  • $7,000 if under 50, $8,000 if 50+ (catch-up contribution).
  • Phase-out begins at $146k MAGI single / $230k joint, fully phased out at $161k / $240k.
  • Above the phase-out, look into "Backdoor Roth IRA" — contribute to a traditional IRA, then convert immediately.

Tax-free growth is a big deal

$7,000/year contributed for 30 years at 7% returns: $660k. In a Roth, that's $660k tax-free. In a traditional IRA at a 22% retirement bracket, it's $515k after tax. The Roth is worth $145k more — purely because Uncle Sam never takes a cut of the growth.

When traditional beats Roth

If you're a high earner in a 32%+ bracket today and confident you'll be in a much lower bracket in retirement (say 15%), traditional may win on after-tax dollars. The decision turns on your future-tax-rate estimate, which nobody can know with certainty. Splitting contributions between traditional and Roth hedges the bet.

The Roth's hidden flexibility

Roth IRA contributions (not earnings) can be withdrawn anytime, tax-free and penalty-free. This makes the Roth a secondary emergency fund for younger savers. The earnings have the standard 59½/5-year rules. This flexibility makes Roth uniquely suited for early-career savers who might need liquidity.

Frequently asked questions

Roth IRA vs Roth 401(k)?
Same tax treatment, different limits and access. Roth 401(k) limit is $23,000; Roth IRA is $7,000. 401(k) usually has higher fees but employer match. IRA gives full investment choice. Many people fund both.
What’s the 5-year rule?
For tax-free withdrawal of earnings, the Roth account must be open at least 5 years AND you must be 59½+ (or qualify for an exception). Conversion 5-year rules are separate and apply to converted amounts. Contributions can always be withdrawn without penalty regardless of age.
Should I do a Backdoor Roth?
If your income exceeds the phase-out limit and you have no existing traditional IRA balance (pro-rata rules can sting), yes. Contribute to a traditional IRA non-deductibly, then convert to Roth. The administrative friction is real but worthwhile for the long-term tax-free compounding.
Are there RMDs on a Roth IRA?
No — unlike traditional IRAs and 401(k)s, Roth IRAs have no Required Minimum Distributions during the original owner’s lifetime. This makes them powerful estate-planning vehicles too.

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