Understanding the roth ira calculator
A Roth IRA is funded with money you've already paid tax on, and in exchange every dollar it earns comes out completely tax-free in retirement. Over decades, the growth usually dwarfs the contributions meaning the bulk of a Roth's final balance is money that will never be taxed, which is its defining advantage over a traditional account.
Roth IRAs suit savers who expect to be in the same or a higher tax bracket later, and they carry no required minimum distributions, so the money can keep compounding for life or pass to heirs. Contributions are capped annually and phase out at higher incomes, but the flexibility you can withdraw your own contributions penalty-free at any time makes it a cornerstone of many retirement plans.
Results are estimates for education only and are not financial advice.