Roth IRA Calculator

You're 32, planning to put $7,000 a year into a Roth IRA, and assuming 7% real returns. By age 65, that's roughly $730,000 — and unlike a traditional IRA, every dollar of it comes out tax-free. Plug in your numbers and see the projection year by year.

The calculator handles annual contributions, expected return rate, and current age versus retirement age. Adjust any input to see how the curve shifts. Skipping a single year of $7K contributions in your 30s costs you roughly $50K in retirement — front-loading matters because of the compounding tail.

Doesn't account for changes in contribution limits over time (Congress adjusts these), or for the income phase-out that disqualifies high earners.

The compounding formula at the heart of the calculator is: FV = PMT × [((1+r)^n − 1) / r] × (1+r), assuming annual contributions and annual compounding. PMT is the annual contribution, r is the assumed annual real return (typically 7%), and n is the number of years until retirement. For $7,000 annually starting at age 32, retiring at 65, at 7%: that's $7,000 × [((1.07)^33 − 1) / 0.07] × 1.07. The calculation produces approximately $740,000–760,000, depending on whether the contribution happens at the start or end of each year.

The Roth's distinctive feature is the tax treatment: contributions go in after-tax (no upfront deduction), but qualified withdrawals — including all the growth — are tax-free. Compare with a traditional IRA where you get the deduction now and pay tax on everything in retirement. Which wins depends on your current versus future tax bracket. A 22% bracket worker now who'll be in the 22% bracket in retirement gets the same outcome from either. A 12% bracket worker now who'll be in the 22% bracket in retirement does better with Roth. The break-even question is one of the most consequential financial decisions in early career.

A worked example showing the cost of skipping a year: at 32, skipping a $7,000 contribution costs you the future value of that contribution at retirement. At 7% over 33 years, $7,000 grows to roughly $66,000. So one missed year costs you $66,000 of tax-free retirement money — and that math gets worse the earlier you skip. A skipped contribution at 25 costs roughly $107,000 in projected retirement value. The cost of procrastination is invisible until you compute it.

What the calculator doesn't model: the income phase-out. For 2024, single filers above $146K start phasing out, fully out at $161K. Married filing jointly: $230K to $240K. Above those thresholds, you can't contribute directly. The 'backdoor Roth' workaround — contribute to a traditional IRA, then convert — works but has complications (the pro-rata rule on existing pre-tax IRA balances can create unexpected tax bills). The calculator assumes you're under the limits; if you're not, the math is the same but the path to making the contribution gets more involved.