Roth IRA Calculator

A Roth IRA is the rarest thing in personal finance: a real free lunch. You pay tax on the contribution now, and every dollar of growth — plus every penny of withdrawal after 59½ — comes out entirely tax-free. For a 35-year-old contributing $7,000 a year for 30 years, that is about $902,000 of tax-free money at age 65. If those same dollars had been in a taxable brokerage account, tax drag on interest and dividends would have cut the balance to roughly $740,000.

The Roth's second advantage is no RMDs during the owner's lifetime. A traditional IRA forces withdrawals starting at 73; a Roth does not. That makes the Roth the best estate-planning account — children who inherit it get 10 years of tax-free growth before they have to empty it. Pair this with the RMD Calculator to see the contrast.

Starting Roth balance $25,000, annual contribution $7,000 (the 2026 limit), 30 years, 7% return. The $25,000 alone grows to $190,000. The $7,000-a-year stream grows to $712,000. Total: $902,000 — all withdrawable tax-free at 59½.

Now compare against a traditional 401(k) with identical inputs but a 22% retirement-era tax rate: $902,000 × 0.78 = $704,000 spendable. The Roth is worth $198,000 more in after-tax dollars despite identical pre-tax contributions, because we effectively dodged tax on 30 years of growth. That is the tax-free growth advantage in one number.

2026 Roth IRA direct-contribution phaseouts: single filers $150,000–$165,000 MAGI (full to zero), married filing jointly $236,000–$246,000. Above that, direct contributions are banned — but the backdoor Roth is still available to anyone. Contribute $7,000 to a non-deductible Traditional IRA, then convert it to Roth the next day. Watch the pro-rata rule if you have other pre-tax IRA balances; the IRS will tax the conversion proportionally.

If both you and your spouse have earned income, both of you can contribute. A stay-at-home spouse with a working partner qualifies through the "spousal IRA" rule. Students and minors with earned income can open a custodial Roth — arguably the best gift a grandparent can give.

There are two 5-year rules and they trip up a lot of retirees. Rule 1: for tax-free withdrawal of earnings, your first Roth IRA must be at least 5 years old and you must be 59½. Rule 2: each Roth conversion has its own 5-year clock before the converted amount can be withdrawn penalty-free if you are under 59½. Contributions (not earnings) can always be withdrawn penalty-free and tax-free — that is what makes the Roth a solid emergency-fund backup for diligent savers.

Use Roth if your retirement tax rate will be higher than your current rate; Traditional if lower. Since most people cannot predict, a practical rule of thumb: 12% or 22% bracket now → Roth. 32%+ bracket now → Traditional. In between, split. When in doubt, diversify — have some of each so you can manage your bracket in retirement year by year. Our Roth Conversion Calculator models the conversion math in detail.

Three mistakes wreck most Roth IRA plans. One: planning on 10% returns. The S&P 500 averaged ~10% nominal since 1928, but inflation and 0.5% fund fees bring that to roughly 5.5–6% real. Run the 10% number and you will be underfunded by 20–30% in any realistic outcome. Two: ignoring taxes on the way out. A $1,000,000 pre-tax 401(k) is $750,000–$800,000 spendable for most households once federal and state tax come out. Three: treating Social Security as fixed. Claiming at 62 pays 70% of your primary insurance amount; waiting to 70 pays 124%. On a $2,400 PIA that is $1,680 vs $2,976 a month — a $15,552-per-year, lifelong spread.

One Roth-specific mistake: withdrawing earnings before 59½. Earnings pulled early get hit with income tax plus a 10% penalty, even after the 5-year clock. Only contributions come out free. Track contribution vs earnings basis annually.

Use this calculator to get a directional answer in five minutes. Hire a fee-only fiduciary CFP (search NAPFA, XY Planning Network, or Garrett) when the Roth IRA decision involves any of these: portfolio over $750,000, a defined-benefit pension with a lump-sum option, rental property, concentrated stock (ISOs, RSUs, founder shares), a blended family, special-needs planning, or a move across a state line. A $3,000 one-time plan typically recovers its cost many times over in avoided tax and claim-timing mistakes.

For a simpler situation — single account, single state, standard Social Security — this tool plus an annual self-review is fine. Re-run every October so you still have time to act on the year.

This is not financial, tax, investment, or legal advice. Calculations are educational and rely on the inputs you provide. Tax brackets, contribution limits, Social Security PIA bend points, RMD factors, and Medicare IRMAA thresholds change — verify against the official IRS, SSA, and CMS tables before acting on any number. Past investment returns do not predict future results. For a legally binding plan, engage a licensed fiduciary, CPA, or estate attorney.

This tool runs entirely in your browser — nothing you type is logged, stored, or sent to a server. Use Export PDF to save a clean copy of your inputs and results for a spouse, advisor, or your own records. Missing a Roth IRA scenario you need? Email us at hello@retirementhub.dev and we will add it.