Traditional IRA Calculator
Project the growth of your Traditional IRA with tax-deductible contributions and tax-deferred compounding.
Projected IRA Value
$608,228
Projected IRA Value vs Years Until Retirement
Formula
## Traditional IRA Overview A Traditional IRA offers tax-deductible contributions that grow tax-deferred until withdrawal in retirement. ### Key Features - **Contribution limit**: $7,000/year ($8,000 if age 50+) for 2024 - **Tax deduction**: Contributions may be fully or partially deductible depending on income and employer plan - **Tax-deferred growth**: No taxes on gains until withdrawal - **Taxed at withdrawal**: Distributions are taxed as ordinary income - **Required Minimum Distributions**: Must begin at age 73 ### Best For People who expect to be in a LOWER tax bracket in retirement than they are now.
Esempio Risolto
$25,000 current balance, $7,000 annual contribution, 7% return, 25 years, 24% tax bracket.
- 01Current balance grows: $25,000 x (1.07)^25 = $135,700
- 02Contributions grow: $583/mo at 7% for 25 years = ~$474,300
- 03Total projected value: ~$610,000
- 04Tax savings from deductions: $7,000 x 24% x 25 = $42,000
Domande Frequenti
Should I choose Traditional or Roth IRA?
Choose Traditional if you expect a lower tax rate in retirement (high earner now, lower income later). Choose Roth if you expect taxes to rise or want tax-free withdrawals. You can split contributions between both.
What happens if I withdraw early?
Withdrawals before age 59.5 are subject to a 10% penalty plus ordinary income tax. Exceptions include first-time home purchase ($10,000), disability, and substantially equal periodic payments.
Are my contributions deductible?
If neither you nor your spouse has an employer retirement plan, contributions are fully deductible regardless of income. With an employer plan, deductibility phases out at higher income levels.
Impara