How to Use the Roth IRA Calculator
- Enter your age, retirement age and current Roth IRA balance.
- Enter the annual contribution you plan to make.
- Choose your filing status and enter your MAGI.
- Enter an expected return and inflation.
- Press Calculate and check the maximum allowed contribution.
Formula
Limit = annual IRA limit (+ catch-up at 50 or older) If MAGI is within the phase-out range: Allowed = limit − limit × (MAGI − lower) ÷ (upper − lower), rounded up to $10, minimum $200 Balance grows monthly at the assumed return with annual contributions spread evenly.
Example Calculation
A 30-year-old single filer with $90,000 MAGI is below the phase-out, so the full annual limit applies. Contributing $7,000 a year at a 7% return until age 65 with a $5,000 starting balance reaches about $1.05 million (about $443,000 in today’s dollars at 2.5% inflation), of which roughly $802,000 is earnings.
What Is a Roth IRA Calculator?
It projects the growth of an individual retirement account funded with after-tax money and checks how your income affects what you may contribute. Because Roth withdrawals can be tax-free, the projected balance is more directly comparable to spendable money than a pre-tax balance.
How the Income Phase-Out Works
Within the phase-out range, your allowed contribution shrinks gradually; above it, it falls to zero. The ranges differ for single filers, married couples filing jointly and others, and are adjusted periodically.
Benefits and Trade-offs
- Tax-free growth and qualified withdrawals.
- No required minimum distributions for the original owner.
- No upfront deduction.
- Annual contribution limits are lower than for a 401(k).
Tips
- Contribute early in the year to give money more time to grow.
- Choose investments that match your time horizon.
- Confirm eligibility each year because limits change.
Common Mistakes
- Contributing when income exceeds the limit, which can lead to penalties.
- Opening an account but never investing the cash.
- Withdrawing earnings early without checking the rules.
Compare with the traditional IRA calculator and read 401(k) vs Roth IRA.