Roth IRA calculator
Compare projected Roth savings with a taxable investment whose gains are taxed only on final sale.
Formula
Balance = P(1+r)^n + CΣ(1+r)^k, k=0…n−1; taxable = balance − max(gain,0) × tax%.
Total after-tax capital ≈ (1,000)+(100)×(20) · Projected qualified Roth balance ≈ (1,000)×(1.05)^(20)+(100)×(33.0659541) · Taxable balance after final sale ≈ (5,959.893115)-max((5,959.893115)-(3,000),0)×(20)÷100
How to use
- Enter initial after-tax capital and yearly end-of-year contribution.
- Set years, annual return and assumed tax on final taxable gains.
- Compare balances, assuming the Roth withdrawal qualifies.
Examples
- Start 1,000, add 100 at each year end for 2 years at 10%: Roth 1,420; taxable 1,376 at 20% gains tax.
Frequently asked questions
Does this verify Roth eligibility?
No. Check IRS income and contribution rules yourself; the amounts entered are assumptions.
What tax treatment is assumed?
Qualified Roth withdrawals are tax-free. The comparison taxes gains once at final sale, with no annual distributions or loss relief.
What else is excluded?
Early withdrawals, conversions, fees and inflation; future returns and tax rates may change.
Sources
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