Why a Roth IRA is powerful
You contribute after-tax dollars, so there’s no upfront deduction — but every dollar of growth comes out tax-free in retirement, as long as you’re 59½ or older and the account has been open five years. Decades of compounding mean the tax-free growth usually dwarfs the contributions themselves, which is the whole point of a Roth.
2026 contribution limits
You can contribute up to $7,500 to a Roth IRA for 2026, rising to $8,600 from age 50 (a $1,100 catch-up). This calculator applies the right cap automatically as you age, so a steady contribution that exceeds the limit is trimmed to what’s actually allowed. The limit is the combined total across all your traditional and Roth IRAs.
Roth vs Traditional vs taxable
A Traditional IRA/401(k) gives a tax break now but is taxed on withdrawal; a Roth is the reverse — pay tax now, withdraw tax-free later, which wins if your retirement tax rate is similar or higher. Both beat a regular taxable account, where you’d owe capital-gains tax on the growth. The “tax saved” figure above estimates that ~15% bite a taxable account would take.
Income limits to watch
Roth eligibility phases out at higher incomes: for 2026, a single filer’s ability to contribute shrinks between $153,000 and $168,000 of modified AGI, and a married couple filing jointly between $242,000 and $252,000. Above those, look into a “backdoor” Roth or a Traditional IRA instead.