Roth IRA Calculator
See the power of tax-free growth
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Roth IRA vs Traditional IRA: Which Wins for You?
Why Choose Roth
With Roth, you pay taxes now at your current rate and enjoy tax-free growth and withdrawals forever. If you expect to be in a higher bracket in retirement (common for young professionals), Roth wins. Consider: a 30-year-old contributing $7,000/year for 35 years at 7% return accumulates $922,000. With Roth, all $922,000 is tax-free. With a Traditional IRA, you would owe taxes on every dollar withdrawn — potentially $200,000+ in taxes at the 22% bracket.
Roth vs Traditional Comparison
Income Limits & Eligibility (2026)
Roth IRA has income limits: single filers under $150,000 MAGI can contribute the full amount. The contribution phases out between $150,000-$165,000. Married filing jointly: full contribution under $236,000, phaseout $236,000-$246,000. The backdoor Roth strategy is available for higher earners — contribute to a Traditional IRA and immediately convert to Roth. This is legal and widely used.
Internal Resources
Explore related tools: Retirement Calculator · 401K Calculator · Compound Interest Calculator · Salary Calculator
Written by Finance Experts · Last updated September 2026
Frequently Asked Questions
What is a Roth IRA and how does it work?
A Roth IRA uses after-tax dollars for contributions, grows tax-free, and allows tax-free withdrawals in retirement. For 2026, you can contribute up to $7,000 ($8,000 if 50+). There are income limits: single filers under $150,000 MAGI can contribute fully.
Roth IRA vs Traditional IRA — which is better?
Roth is better if you expect a higher tax rate in retirement or want tax-free withdrawals. Traditional is better if you need the tax deduction now and expect a lower rate later. Many advisors recommend having both for tax diversification.
What is the backdoor Roth IRA?
If your income exceeds Roth IRA limits ($150K single), you can contribute to a Traditional IRA and immediately convert to Roth. This is legal and widely used. There is no income limit on Roth conversions. This strategy is called the backdoor Roth.
Can I withdraw Roth IRA contributions?
Yes — you can withdraw your contributions (not earnings) at any time, tax-free and penalty-free. This makes a Roth IRA a flexible emergency fund option. Earnings withdrawn before 59½ may be subject to taxes and penalties.
How much will $6,500 grow in a Roth IRA?
At 7% annual return: $6,500/year for 30 years grows to $656,000, all tax-free. $6,500/year for 20 years grows to $283,000. The power of tax-free compounding means you never pay taxes on the growth.
What can I invest in with a Roth IRA?
Roth IRAs can hold stocks, bonds, mutual funds, ETFs, CDs, and even real estate through a self-directed Roth IRA. Most people choose low-cost index funds (S&P 500, total market) for simplicity and long-term growth.
When can I withdraw from my Roth IRA?
Contributions can be withdrawn anytime tax-free. Earnings can be withdrawn tax-free after age 59½ AND the account has been open for 5+ years (the 5-year rule). This is a significant advantage over Traditional IRAs and 401(k)s.
Should I max out my Roth IRA before my 401(k)?
The recommended order: (1) Get full 401(k) employer match, (2) Max out Roth IRA ($7,000), (3) Go back and max out 401(k) ($23,500). This prioritizes free employer money first, then tax-free Roth growth, then additional tax-deferred savings.
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When to Use This Calculator
Use this calculator when you want to know if your current savings rate is on track, how much more you need to save, whether to prioritize a 401(k) or Roth IRA, or how Social Security factors in.
401(k) vs Roth IRA vs Traditional IRA
Priority order: 1) Get full 401(k) employer match. 2) Max out Roth IRA ($7,000). 3) Go back to 401(k) and increase contributions. 4) Taxable brokerage for anything extra.
Real-World Example: Retirement at 65
- Her contribution: $12,000/year ($1,000/month)
- Employer match: $3,200/year (4% of salary)
- Total annual: $15,200
- At 7% return for 30 years: $1,441,491
Data Sources & Citations
- OfficialSocial Security Administration
- OfficialInternal Revenue Service (IRS)
Disclaimer: Calculators and tools on this site are for informational purposes only and do not constitute financial, tax, legal, medical, or investment advice. Results are estimates and may not reflect actual rates or terms. Consult a qualified professional before making decisions. Privacy Policy
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