IRA Retirement Growth Projector
Estimate the future value of your Individual Retirement Account
Projection Results
Estimated balance at age :
Total contributions made:
Estimated growth/earnings:
After-tax estimate (if Traditional IRA):
How an IRA Retirement Calculator Works
Planning for retirement is one of the most critical financial tasks you will ever undertake. An IRA (Individual Retirement Account) is a powerful tool designed to help you save for the future with tax advantages. This calculator helps you visualize how compounding growth and consistent monthly contributions can transform a small initial investment into a substantial nest egg over decades.
The Power of Compounding Growth
The primary driver of retirement savings is not just the money you put in, but the returns that money generates over time. When your account earns dividends or capital gains, those earnings are reinvested to earn even more. This "interest on interest" effect accelerates as your balance grows, particularly in the final decade before retirement.
Key Variables in Retirement Planning
- Time Horizon: The number of years between your current age and your retirement age. The longer your money stays invested, the more time it has to weather market volatility and benefit from compounding.
- Annual Return: Historically, the stock market has returned roughly 7-10% annually (not adjusted for inflation). However, it is often safer to project using a conservative 5% or 6% to account for market fluctuations.
- Contribution Consistency: Regular monthly deposits often outperform sporadic large deposits because they utilize dollar-cost averaging.
Example Scenario
Imagine a 30-year-old with a starting IRA balance of $5,000. If they contribute $500 every month and achieve an average annual return of 7%, by age 65, their account could grow to over $860,000. Of that total, only $215,000 would be from their own contributions, while over $640,000 would come from market growth.
Traditional vs. Roth IRA
While this calculator provides a gross total, your actual "spendable" money depends on the type of IRA you choose:
- Roth IRA: You contribute post-tax money. Your withdrawals in retirement are generally tax-free.
- Traditional IRA: You may get a tax deduction now, but your withdrawals in retirement are taxed as ordinary income.