Roth IRA Calculator

Calculate how your Roth IRA will grow tax-free with annual contributions and compound returns.

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Understanding Roth IRA Growth

A Roth IRA is one of the most powerful retirement savings tools available because of its tax-free growth. Unlike traditional IRAs or 401(k)s, you pay taxes on the money you contribute, but everything grows tax-free and you never pay taxes on withdrawals in retirement.

Roth IRA vs Traditional IRA

The key difference is the tax treatment. With a traditional IRA, contributions may be tax-deductible, but withdrawals are taxed. With a Roth IRA, contributions are not deductible, but withdrawals are completely tax-free. If you expect to be in a higher tax bracket in retirement, a Roth IRA is usually the better choice.

Maximizing Your Roth IRA

To maximize your Roth IRA benefits, contribute the full annual amount allowed ($7,000 in 2026). If you're over 50, you can make catch-up contributions of an additional $1,000. Start as early as possible to take advantage of compound growth over decades.

Frequently Asked Questions

What is a Roth IRA and why should I open one?

A Roth IRA is an individual retirement account where you contribute after-tax dollars. All growth and withdrawals in retirement are tax-free.

What is the Roth IRA contribution limit for 2026?

For 2026, the limit is $7,000 per year for those under 50, and $8,000 for those 50 and older with catch-up contributions.

Am I eligible to contribute to a Roth IRA?

Eligibility depends on your modified adjusted gross income (MAGI). For 2026, single filers can contribute the full amount if their MAGI is below $146,000.

Can I withdraw from my Roth IRA before retirement?

You can withdraw your contributions tax-free and penalty-free at any time. However, withdrawing earnings before age 59.5 typically results in taxes and a 10% penalty.

What is the tax advantage of a Roth IRA?

The main advantage is tax-free growth and withdrawals. You pay taxes on contributions now, but all growth is tax-free forever.