IRA Calculator
Compare Traditional and Roth IRAs, calculate contribution limits, tax benefits, and plan your retirement savings strategy with our comprehensive IRA calculator.
IRA Planning Details
How to Use the IRA Calculator
- Choose IRA Type: Select between Traditional IRA (tax-deductible) or Roth IRA (tax-free growth)
- Enter Personal Information: Input your current age, planned retirement age, and current IRA balance
- Set Contribution Details: Enter your planned annual contribution and current income
- Select Filing Status: Choose your tax filing status to determine contribution eligibility
- Input Tax Information: Enter your current and expected retirement tax rates
- Review Results: Compare total balance, tax benefits, and after-tax value projections
Traditional vs Roth IRA Examples
Traditional IRA Scenario
Roth IRA Scenario
IRA Decision Guidelines:
- Choose Traditional if: You expect to be in a lower tax bracket in retirement
- Choose Roth if: You expect to be in the same or higher tax bracket in retirement
- Young Investors: Roth IRAs often better due to decades of tax-free growth
- Diversification: Consider having both types for tax diversification in retirement
Understanding IRA Rules and Limits
2024 Contribution Limits
Under Age 50
$7,000 annual contribution limit
Age 50 and Over
$8,000 annual contribution limit (includes $1,000 catch-up)
Contribution Deadline
Tax filing deadline (typically April 15)
Income Limits (2024)
Traditional IRA (Single)
Deduction phases out: $77,000 - $87,000
Roth IRA (Single)
Contribution phases out: $138,000 - $153,000
Married Filing Jointly
Different limits apply - use calculator for accuracy
IRA Benefits and Considerations
Traditional IRA Benefits
Immediate Tax Deduction
Reduces your current year taxable income
Tax-Deferred Growth
Investments grow without annual tax on gains
Lower Current Tax Bill
Especially beneficial if in high tax bracket now
Roth IRA Benefits
Tax-Free Withdrawals
No taxes on qualified retirement withdrawals
No Required Distributions
Unlike Traditional IRAs, no forced withdrawals at 73
Contribution Flexibility
Can withdraw contributions anytime penalty-free
Frequently Asked Questions
Can I contribute to both Traditional and Roth IRAs?
Yes, but your total contributions to both accounts cannot exceed the annual limit ($7,000 or $8,000 if 50+). You can split contributions between the two types.
What if my income is too high for IRA contributions?
High earners may not qualify for deductible Traditional IRA contributions or direct Roth contributions. Consider a "backdoor Roth IRA" conversion strategy.
When can I withdraw from my IRA without penalties?
Generally at age 59½. Early withdrawals may incur 10% penalty plus taxes. Some exceptions exist for first-time home purchases, education, and medical expenses.
Do I have to take money out of my IRA in retirement?
Traditional IRAs require minimum distributions starting at age 73. Roth IRAs have no required minimum distributions during the owner's lifetime.
Can I convert a Traditional IRA to a Roth IRA?
Yes, you can convert any amount at any time. You'll pay taxes on the converted amount in the year of conversion, but future growth will be tax-free.
What happens to my IRA when I die?
Beneficiaries can inherit IRAs. Spouses have the most flexibility, while non-spouse beneficiaries typically must empty inherited accounts within 10 years.
Related Calculators
Retirement Calculator
Comprehensive retirement planning including 401k, IRA, and Social Security.
401k Calculator
Calculate 401k contributions, employer match, and retirement projections.
Tax Calculator
Calculate federal and state taxes to optimize IRA contribution strategy.