- Annual contribution
- The amount you will contribute to your ROTH IRA each year. This calculator assumes that you make your contribution at the beginning of each year. In 2003, the maximum IRA annual contribution is $3,000 per individual. It is important to note that this is the maximum total contributed to all of your IRA accounts. This maximum will increase gradually to $5,000 by 2008. The table below summarizes IRA annual contribution limits.
| Year | IRA contribution limit |
| 2002-2004 | $3,000 |
| 2005-2007 |
$4,000 |
| 2008 and after* | $5,000 | *Beginning in 2009, the contribution limit will adjust annually for inflation in $500 increments
If you are 50 or older you can make additional "catch-up" contributions of $500 more than the normal limits in 2002 through 2005. Starting in 2006, the "catch-up" amount will increase to $1,000. In order to qualify for the "catch-up" contribution, you must turn 50 by the end of the year in which you are making the contribution.
It is important to note that Roth IRA contributions are limited for higher incomes. If your income falls in a "phase-out" range you are allowed only a prorated Roth IRA contribution. If your income exceeds the phase-out range, you do not qualify for any Roth IRA contribution. For the purposes of this calculator, we assume that your income does not limit your ability to contribute to a Roth IRA. The table below summarizes the income "phase-out" ranges for Roth IRAs.
| Tax filing status | Income Phase-Out Range |
| Married filing jointly or Head of household | $150,000 to $160,000 |
| Single |
$95,000 to $110,000 |
| Married filing separately | $0 to $10,000 |
- Expected rate of return
- The annual rate of return for your IRA. This calculator assumes that your return is compounded annually and your contributions are made at the beginning of each year. The actual rate of return is largely dependant on the type of investments you select. For example, from January 1970 to February 2003 the average compounded rate of return for the S&P 500, including reinvestment of dividends, was approximately 11%. Savings accounts at a bank pay as little as 2% or less. It is important to remember that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are subject to higher risk and volitility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment.
- Current age
- Your current age.
- Age of retirement
- Age you wish to retire. This calculator assumes that the year you retire you do not make any contributions to your IRA. So if you retire at age 65, your last contribution is assumed to have happened when you were actually 64.
- Marginal tax rate
- The marginal tax rate you expect to pay on your taxable investments.
- Roth total at retirement
- Total value in your Roth IRA at your retirement.
- Total taxable savings
- The total amount you would have accumulated by retirement in a taxable savings account.
|