Project Traditional and Roth IRA growth, compare tax treatments, check contribution limits, and estimate retirement income
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Founder & CEO, Toolraxy
Faiq Ur Rahman is a web designer, digital product developer, and founder of Toolraxy, a growing platform of web-based calculators and utility tools. He specializes in building structured, user-friendly tools focused on health, finance, productivity, and everyday problem-solving.
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An IRA is only as good as the assumptions you feed it. The same $7,000 a year becomes wildly different balances at 55 versus 65, at 4% returns versus 9%. This calculator makes those trade-offs visible.
Retirement savers use it for two things. First, a reality check: am I on track? Second, a decision: Traditional or Roth? The tool answers both without needing a financial advisor or a spreadsheet. It applies the same compounding math a brokerage projection would, then layers in the tax treatment, the withdrawal rate, and the 2024 contribution cap so you can see the whole picture in one screen.
How to Use the IRA Calculator
Set your currency. The dropdown updates every money field, from USD to EUR to INR.
Enter your current IRA balance. A zero is fine if you’re starting fresh.
Pick an annual contribution amount. The 2024 cap is $7,000 under 50 and $8,000 if you’re 50 or older. The tool flags any input above the limit.
Choose the account type. Traditional, Roth, or Compare both. Compare mode adds a side-by-side table.
Enter your age and retirement age. The gap between them is the compounding window.
Set an expected annual return. 7% is a common starting point for a stock-heavy portfolio, before inflation.
Add a contribution growth rate. A 2% bump each year matches a typical cost-of-living raise. Leave it at zero if you expect flat contributions.
Fill in the tax rates and withdrawal rate. Current tax, retirement tax, and the percentage you plan to pull out each year.
Each year, the calculator adds your contribution to the existing balance, then multiplies the whole pile by the return rate.
Formula: Balance (Year N) = (Balance (Year N−1) + Contribution) × (1 + Return Rate)
Contributions happen at the start of each year, so every deposit gets a full year of growth. That’s a small but meaningful detail. A contribution made in January compounds 12 months sooner than one made in December.
If you enter a contribution growth rate, the annual deposit increases by that percentage every year.
Formula: Contribution (Year N) = Contribution (Year N−1) × (1 + Contribution Growth Rate)
The after-tax comparison uses two formulas:
Formula: Traditional After-Tax = Balance × (1 − Retirement Tax Rate)
Formula: Roth After-Tax = Balance (qualified withdrawals are tax-free)
Annual income comes from the withdrawal rate:
Formula: Annual Withdrawal = Balance × Withdrawal Rate
Worked Example
Say you’re 32 with $28,600 already in a Traditional IRA. You contribute $7,000 a year, expect a 7.2% average return, and plan to retire at 67. That’s 35 years of compounding. You also expect to bump contributions by 2% each year.
Step 1: Contributions grow from $7,000 to about $13,900 by year 35. Total deposited over the period: roughly $348,000.
Step 2: The account compounds to $1,185,400 by age 67.
Step 3: Investment growth alone (balance minus starting balance minus contributions) is about $808,800. That’s the compounding dividend.
Step 4: At a 4% withdrawal rate, gross annual income is $47,416. At a 19% retirement tax rate, after-tax income lands at $38,407 a year, or $3,200 a month.
Step 5: Switch to Roth using the same inputs. The balance and withdrawal math don’t change, but the after-tax figure stays at $47,416. That’s a $9,009 annual difference in retirement income. Whether Roth is actually better depends on whether paying tax now at 24% beats paying it later at 19%.
Depends entirely on contributions and returns. A $7,000 yearly contribution growing at 7% for 30 years lands near $660,000. Bump the return to 8% and it climbs past $790,000. Run your own numbers in the tool for a personalized projection.
It depends on your tax rates. If you expect a higher tax bracket in retirement, Roth wins. If you’re in your peak earning years now and expect a lower bracket later, Traditional usually wins. The calculator’s compare mode shows the after-tax difference in dollars.
The limit is $7,000 if you’re under 50 and $8,000 if you’re 50 or older. The cap applies across all IRAs combined. Roth contributions also have income phase-outs, which the calculator doesn’t check.
Each year, the tool adds your contribution to the balance, then multiplies by the return rate. Contributions are made at the start of the year so every dollar gets a full year of growth. Over decades, that small timing detail adds up.
A stock-heavy portfolio has historically returned around 7% after inflation and closer to 10% before it. A balanced 60/40 portfolio runs closer to 6% to 7% nominal. Use 6% to 7% for a conservative estimate and stress-test at 4% to see how much worse a bad market looks.
Yes, but the combined total can’t exceed the annual limit. You could put $4,000 in a Traditional and $3,000 in a Roth in 2024, but not $7,000 in each. Income limits may also prevent Roth contributions at higher salary levels.
The IRS charges a 6% excise tax on the excess amount for every year it stays in the account. The fix is to withdraw the excess plus any earnings before the tax filing deadline. The calculator flags over-limit inputs but doesn’t model the penalty.
That depends on your lifestyle and withdrawal rate. At a 4% withdrawal rate, $1 million supports $40,000 a year before tax. If you need $60,000 a year, you’d need roughly $1.5 million. Social Security and other savings reduce the target.
The default math doesn’t adjust for inflation unless you lower the return assumption. If inflation runs 3% and your portfolio returns 7%, your real return is about 4%. For long projections, use a real return figure so the final balance is expressed in today’s purchasing power.
Age 59½ is the standard threshold. Before that, the IRS charges a 10% penalty on top of ordinary income tax, with a handful of exceptions like first-home purchases and qualified education costs. Roth contributions can be withdrawn at any time without penalty since tax was already paid.
No. RMDs start at age 73 for Traditional IRAs and don’t apply to Roth IRAs for the original owner. Modeling RMDs requires year-by-year withdrawal calculations that depend on IRS life-expectancy tables, which are outside this tool’s scope.
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