The following infographic will demonstrate the benefits of maxing out a Roth IRA. Please share this with your family and friends!
[Update] Since we created this infographic the contribution limits have increased from $5,500 to $6,000 so even more money can be raised!
Also see: We have built our own Compound Interest Calculator to save you the trouble of having to download one. We’ve even made improvements on that by creating a Habit Calculator to demonstrate the cost of many habits. We look forward to speaking more about Roth IRAs and Compound Interest in our Season Two content: Dollar School.
For more information about what compound interest is and how it works you can watch this video.
Here are some details on rules regarding a Roth IRA via https://www.irs.gov/retirement-plans/roth-iras:
A Roth IRA is an IRA that, except as explained below, is subject to the rules that apply to a traditional IRA.
- You cannot deduct contributions to a Roth IRA.
- If you satisfy the requirements, qualified distributions are tax-free.
- You can make contributions to your Roth IRA after you reach age 70 ½.
- You can leave amounts in your Roth IRA as long as you live.
- The account or annuity must be designated as a Roth IRA when it is set up.
The same combined contribution limit applies to all of your Roth and traditional IRAs.