Roth IRA Calculator 2025
Calculate your contribution limits, check income eligibility, and see how your tax-free retirement savings can grow
Your Information
Your Roth IRA Analysis
✓ Eligible for Roth IRA
Full contribution limit available: $7,000
2025 Contribution Limits
Under Age 50
$7,000
Age 50+
$8,000
At Retirement (Age 65)
Projected Balance
$0
Total Contributions
$0
Tax-Free Growth
$0
Tax-Free Withdrawals
Your $0 in growth will be 100% tax-free in retirement. At a 22% tax rate, that's $0 in tax savings!
What Is a Roth IRA?
A Roth IRA (Individual Retirement Account) is a tax-advantaged retirement savings account that offers unique benefits compared to traditional retirement accounts. Named after Senator William Roth, who championed its creation in 1997, the Roth IRA has become one of the most powerful tools for building tax-free retirement wealth.
Unlike a Traditional IRA where you get a tax deduction now but pay taxes on withdrawals later, a Roth IRA works in reverse: you contribute after-tax dollars today, but all qualified withdrawals in retirement—including decades of investment growth—are completely tax-free.
Key Insight: If you invest $7,000 per year from age 25 to 65 at 7% average returns, you'll contribute $280,000 total, but your account will grow to approximately $1.4 million—and every penny of that $1.1 million in growth is tax-free!
2025 Roth IRA Contribution Limits
| Age Group | 2024 Limit | 2025 Limit | Notes |
|---|---|---|---|
| Under Age 50 | $7,000 | $7,000 | Standard contribution limit |
| Age 50 or Older | $8,000 | $8,000 | Includes $1,000 catch-up |
* The $7,000/$8,000 limit is the total you can contribute across ALL your IRAs (Traditional + Roth combined), not per account.
2025 Income Eligibility Limits (MAGI)
Your ability to contribute directly to a Roth IRA depends on your Modified Adjusted Gross Income (MAGI). If your income falls within the "phase-out" range, your contribution limit is reduced proportionally.
| Filing Status | Full Contribution | Phase-Out Range | No Direct Contribution |
|---|---|---|---|
| Single / Head of Household | Under $150,000 | $150,000 - $165,000 | Over $165,000 |
| Married Filing Jointly | Under $236,000 | $236,000 - $246,000 | Over $246,000 |
| Married Filing Separately | $0 | $0 - $10,000 | Over $10,000 |
Roth IRA vs. Traditional IRA: Which Is Better?
| Feature | Roth IRA | Traditional IRA |
|---|---|---|
| Tax Treatment (Contributions) | After-tax (no deduction) | Pre-tax (tax deductible) |
| Tax Treatment (Withdrawals) | Tax-free | Taxed as income |
| Required Minimum Distributions | None | Starting at age 73 |
| Income Limits | Yes (see above) | No (but deduction may be limited) |
| Early Withdrawal of Contributions | Penalty-free anytime | 10% penalty + taxes |
| Best For | Higher tax bracket in retirement | Lower tax bracket in retirement |
Rule of Thumb: Choose Roth if you expect to be in a higher tax bracket in retirement (common for younger workers), or if you want flexibility and no RMDs. Choose Traditional if you need the tax deduction now and expect lower income in retirement.
Backdoor Roth IRA: For High Earners
If your income exceeds the Roth IRA limits, you can still access Roth benefits through a strategy called the Backdoor Roth IRA. This legal workaround has been confirmed by the IRS and is used by millions of high-income earners.
How the Backdoor Roth Works:
- Contribute to a Traditional IRA – There are no income limits for contributions (though deductions may be limited)
- Convert to Roth IRA – Shortly after (often the next day), convert the entire Traditional IRA balance to a Roth IRA
- Pay taxes on any gains – If you convert immediately, gains are typically minimal or zero
- Enjoy tax-free growth – Your money now grows tax-free in the Roth IRA
Pro-Rata Rule Warning: If you have existing Traditional IRA balances, the conversion will be taxed proportionally. Consider rolling old Traditional IRAs into your 401(k) first to avoid this complication.
📊 Real Example: Meet Emily
Emily's Situation:
- • Age: 28 years old
- • Income: $85,000 (Single)
- • Current Roth IRA: $15,000
- • Annual contribution: $7,000 (max)
- • Expected return: 7%
- • Retirement age: 65
Emily's Results:
- • Total contributions: $274,000
- • Projected balance at 65: $1,287,000
- • Tax-free growth: $1,013,000
- • Tax savings at 22%: $223,000
By maxing out her Roth IRA each year, Emily will have over $1 million in tax-free retirement savings. If she had used a Traditional IRA instead and paid 22% on withdrawals, she would owe approximately $223,000 in taxes on the growth alone!
The Roth IRA 5-Year Rules
There are actually two different 5-year rules for Roth IRAs that determine when you can take tax-free and penalty-free withdrawals:
Rule #1: Contribution 5-Year Rule
Your Roth IRA must be open for at least 5 years before you can withdraw earnings tax-free (even after age 59½). The clock starts January 1 of the year you made your first Roth IRA contribution.
Rule #2: Conversion 5-Year Rule
Each Roth conversion has its own 5-year waiting period before you can withdraw that specific conversion amount penalty-free (if under 59½). This prevents using conversions to avoid the early withdrawal penalty.
Good News: You can always withdraw your original contributions (not earnings) from a Roth IRA at any time, tax-free and penalty-free. The 5-year rules only apply to earnings and conversions.
Roth IRA Withdrawal Order
When you take money out of a Roth IRA, the IRS considers withdrawals to come out in a specific order:
Regular Contributions
Always tax-free and penalty-free
Conversion Amounts (FIFO)
Tax-free, but may have 10% penalty if under 59½ and within 5 years
Earnings
Tax-free and penalty-free only if qualified (age 59½ + 5-year rule met)
Spousal Roth IRA: Double Your Savings
Even if your spouse doesn't work, they can still have a Roth IRA! A Spousal IRA allows a working spouse to contribute to an IRA in the name of a non-working spouse, effectively doubling your family's tax-advantaged retirement savings.
Spousal IRA Requirements:
- Must be married filing jointly
- Working spouse must have earned income ≥ total IRA contributions for both spouses
- Non-working spouse must be under age 73
- Each spouse gets their own $7,000 (or $8,000 if 50+) contribution limit
Example: If one spouse earns $100,000 and the other stays home, the working spouse can contribute $7,000 to their own Roth IRA AND $7,000 to a Spousal Roth IRA for their partner—$14,000 total in Roth IRA contributions for the family!
⚠️ Important Disclaimer
This calculator provides estimates for educational purposes only and should not be considered financial or tax advice. Contribution limits, income thresholds, and tax rules change annually. Consult with a qualified financial advisor or tax professional before making retirement planning decisions. Actual investment returns will vary and past performance does not guarantee future results.