Why the Roth is the tax deal of a lifetime
A Roth IRA flips the usual retirement tax order: you contribute money that has already been taxed, and in exchange every dollar of growth comes back out tax-free in retirement — no tax on decades of compounding, and no required minimum distributions for the original owner. This calculator projects the account to your retirement age from your current balance and regular contributions (annual or monthly), and splits the result into what you put in and what growth added, which is the number that makes the Roth case on its own.
Contributions are modeled at the end of each year (an ordinary annuity), with n the years until retirement and r your expected annual return. Switch the frequency to Monthly and contributions are instead modeled at the end of each month, compounding monthly.
Worked example
Start at 30 with nothing saved, contribute $6,000 a year at a 7% return, and by 65 the account holds about $829,421 — of which you contributed $210,000 and growth added roughly $619,421. Under Roth rules that entire balance can be withdrawn tax-free in retirement; in a traditional account the same balance would be taxed as income on the way out.
How to use this calculator
- Enter your age and the age you plan to stop contributing.
- Add any Roth balance you already have.
- Pick a contribution frequency — Annual or Monthly — and enter the amount. Switching converts the figure for you ($6,000 a year becomes $500 a month), and the monthly equivalent is always shown in the results.
- Set a realistic long-run return for a diversified portfolio — 6–8% is the range most planners use for stocks-heavy accounts.
- Compare against the 401(k) Calculator and the Retirement Calculator for the full picture.
Contribution limits and rules of thumb
The IRS caps Roth IRA contributions each year (with a catch-up allowance from age 50) and phases the limit out at higher incomes — check the current year's figures before assuming you can contribute the full amount. Contributions (not earnings) can be withdrawn at any time without tax or penalty, which makes the Roth a quiet emergency backstop, though money taken out loses its tax-free compounding forever. This projection is an estimate, not a guarantee: markets do not pay a smooth 7%, and nothing here is tax or investment advice.