💰 Financial
Roth IRA Calculator
Project the tax-free growth of your Roth IRA. See how your after-tax contributions compound over time to provide a tax-free income stream in retirement.
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Formula
FV = P(1+r)^t + PMT × [((1+r)^t - 1) / r]FV- Future balance (100% Tax-Free)
P- Current Roth IRA balance
PMT- Annual contribution amount
r- Annual expected return
t- Years until retirement
Example
Maxing Out a Roth IRA
Starting at age 25 with $0, and contributing $7,000 every year until age 65, earning an average 7% return.
- Total contributions: $7,000 × 40 years = $280,000.
- Tax-free growth: The compounding interest adds $1,215,645.
- Result: At age 65, you have $1,495,645. Because it is a Roth IRA, you owe $0 in taxes when you withdraw this money.
Frequently Asked Questions
You fund a Roth IRA with money you have already paid taxes on (after-tax). The massive advantage is that all the growth and all future withdrawals in retirement are completely tax-free.
Yes. If your Modified Adjusted Gross Income (MAGI) is too high, you cannot contribute directly to a Roth IRA, though you may be able to use a "Backdoor Roth" strategy.