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IRA Spend It or Save It Calculator

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Spending your IRA before you retire can be a costly decision. Depending on your age and tax bracket, spending your IRA can cost you thousands of dollars both in taxes and lost earnings. This calculator helps illustrate the difference between spending your IRA now, and saving it for retirement.

IRA Spend It or Save It Calculator Definitions

Current age
Your current age.
Age at retirement
Age you wish to retire. The tool calculates the ending balance at retirement for each of your rollover options.
Federal income tax rate
Consult the table below to determine your federal tax bracket. If you are unsure, the calculator will choose 25%. Please note that state taxes are entered in a separate entry field. **TAXTABLE_CURRENT_DEFINITION**
State income tax rate
The current state marginal tax rate you expect to pay on any additional income (or taxable distributions).
Current IRA balance
The starting balance or current amount you have invested or saved in your IRA.
Annual rate of return
The annual rate of return for your IRA account. The actual rate of return is largely dependent on the types of investments you select. The Standard & Poor's 500® (S&P 500®) for the 10 years ending December 31st 2022, had an annual compounded rate of return of 13.6%, including reinvestment of dividends. From January 1, 1970 to December 31st 2022, the average annual compounded rate of return for the S&P 500®, including reinvestment of dividends, was approximately 11.3% (source: www.spglobal.com). Since 1970, the highest 12-month return was 61% (June 1982 through June 1983). The lowest 12-month return was -43% (March 2008 to March 2009). Savings accounts at a financial institution may pay as little as 0.25% or less but carry significantly lower risk of loss of principal balances.

It is important to remember that these scenarios are hypothetical and that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are generally subject to higher risk and volatility. 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. It is not possible to invest directly in an index and the compounded rate of return noted above does not reflect sales charges and other fees that investment funds and/or investment companies may charge.