Roth IRA Calculator: Maximize Tax-Free Retirement
Our Roth IRA Calculator projects growth, compares with Traditional IRA, and shows tax savings.
Roth vs Traditional
- Roth: Pay tax now, withdraw tax-free
- Traditional: Deduct now, tax on withdrawal
Key Rules
- 2024 Limit: $7,000 ($8,000 if 50+)
- Qualified withdrawals tax-free after 59½
- Contributions with after-tax dollars
Example: Age 35 → 65, $7K/yr, 7%
- Roth: ~$790,000
- Traditional (12% tax): ~$695,000 after-tax
- Savings: ~$95,000
Formulas
FV = PV × (1+r)^t + PMT × [((1+r)^t - 1)/r]
Roth After-Tax = FV; Trad After-Tax = FV × (1 - tax_rate)
When Roth Wins
- Lower current tax rate
- Expect higher future tax
- Long time horizon
Pro Tips
- Maximize early
- Convert Traditional to Roth
- Use with planner
Limitations
- Assumes constant return
- No RMDs modeled
- Income limits not enforced
Conclusion
Plan tax-free retirement. Use our Roth IRA Calculator today.