This IRA calculator projects how an individual retirement account grows from today until retirement, combining your current balance, yearly contributions, and compound investment returns. Enter your age, retirement age, contribution, and an expected return to see your projected balance — and how much of it is pure growth.
It works equally well as a Roth IRA calculator or a traditional IRA calculator, because both account types grow the same way; they differ only in when you pay tax. The chart compares your balance against the money you actually put in, which makes the power of compounding obvious.
How IRA Growth Is Calculated
The projection applies annual compounding with end-of-year contributions:
Balance next year = Balance × (1 + r) + Annual contribution
where r is your expected annual return. Repeated over every year to retirement, this is equivalent to the future-value formula FV = B(1 + r)^n + C × [((1 + r)^n − 1) ÷ r].
Two levers dominate the result. Time: money contributed in your 20s and 30s compounds for decades, so early dollars are worth several late dollars. Return: at 7%, money doubles roughly every 10.3 years (the Rule of 72). A 7% assumption approximates the long-run inflation-adjusted return of a diversified stock portfolio; use 5%–6% for a more conservative mixed portfolio.
Roth IRA vs Traditional IRA — and 2025 Contribution Limits
Both IRAs share the same 2025 contribution limit: $7,000 per year, or $8,000 if you are 50 or older (the $1,000 catch-up). The difference is tax timing:
- Traditional IRA: contributions may be tax-deductible now; withdrawals in retirement are taxed as ordinary income. Required minimum distributions start at age 73.
- Roth IRA: contributions are after-tax; qualified withdrawals — growth included — are completely tax-free, with no RMDs. Direct Roth contributions phase out above $150,000 of income (single) or $236,000 (married filing jointly) in 2025.
Rule of thumb: expect a higher tax bracket in retirement (or just want tax-free flexibility)? Choose Roth. Need the deduction today and expect a lower bracket later? Traditional.
Example: Maxing an IRA from Age 30 to 65
Start at age 30 with a $10,000 balance, contribute $7,000 every year, and earn an average 7% return.
- Total contributions by 65: $10,000 + 35 × $7,000 = $255,000.
- Projected balance at 65: about $1,074,000.
- Investment growth: roughly $819,000 — more than three times what you put in.
Start the same plan at 40 instead and the balance at 65 is only about $497,000. Those ten missed years cost well over half a million dollars, even though the extra contributions themselves total just $70,000. In a Roth IRA, the entire $1.07 million could be withdrawn tax-free.
Frequently Asked Questions
What is the IRA contribution limit for 2025?
The 2025 IRA contribution limit is $7,000, or $8,000 if you are age 50 or older thanks to the $1,000 catch-up contribution. The limit is shared across all your traditional and Roth IRAs combined, and you need at least that much earned income for the year to contribute.
What is the difference between a Roth IRA and a traditional IRA?
A traditional IRA gives a possible tax deduction now and taxes withdrawals in retirement; a Roth IRA is funded with after-tax money and qualified withdrawals are entirely tax-free. Roths also have no required minimum distributions. Growth inside both accounts compounds identically — the difference is purely when the IRS takes its share.
How much will an IRA grow in 20 years?
At a 7% average annual return, $7,000 contributed yearly grows to about $287,000 in 20 years, of which only $140,000 is contributions. A $10,000 starting balance alone would grow to about $38,700. Actual results depend on your investments — returns of 5%–8% are common planning assumptions for diversified portfolios.
Can I contribute to both a 401(k) and an IRA?
Yes. The limits are separate: up to $23,500 in a 401(k) and $7,000 in an IRA for 2025 (plus catch-ups if 50+). If you or your spouse are covered by a workplace plan, the traditional IRA deduction phases out at higher incomes, but you can still contribute — or use a Roth IRA if you are under its income limits.
What rate of return should I assume for my IRA?
A 7% annual return is the most common assumption — roughly the U.S. stock market’s long-term average after inflation. Use 5%–6% for a balanced stock/bond portfolio or to be conservative, and remember returns arrive unevenly: the market can drop 20% one year and gain 30% the next. The assumption matters enormously over 30+ years.