How Long Will It Take to Reach a $1,000,000 Savings Goal?

I’m in the process of reading John Bledsoe’s The Gospel of Roth: The Good News About Roth IRA Conversions and How They Can Make You Money
*. So far it’s a great read. As you can probably imagine, Bledsoe is sold on the Roth IRA. Reading his book, I couldn’t help but daydream about what it would be like to have $1,000,000 sitting in a couple of Roth IRAs ($500,000 in each) by the time my wife and I retire.

Then I got to thinking…

How long would it take to get to $1,000,000 in a Roth IRA(s) if I contributed the maximum amount each year to two IRAs?

The maximum contribution amount is currently $5,000 per person ($6,000 per person if you are over 50). Due to silly income restraints, I would have to first contribute to a nondeductible IRA and then convert it to a Roth IRA. Either that, or I could make Roth contributions through my wife’s 401(k).

Here is what the math looks like:

As I noted at the bottom of the graphic, the $1,000,000 goal is not adjusted for inflation.

How long will it take?


If this little exercise tells us anything, it’s that it’s best to start working towards financial goals AS SOON AS POSSIBLE. If you don’t, you are faced with either having to SAVE MORE or reach for higher rates of return (gamble).

*Affiliate Link

2 thoughts on “How Long Will It Take to Reach a $1,000,000 Savings Goal?”

  1. If you have less than 20 years to retirement, then most (if not all) of your annual contributions will be $6K, not $5K. That changes the numbers a bit. The couple in the first row who contributes for 19 years from ages 46-65 only has to achieve a 13.9% ROR; if they contribute from 51-70 they only need a 13.3% ROR.

    Roth IRA contribution limits will probably go up at some point too. In 2002, one could only contribute $3K.

    It still is always better to contribute earlier rather than later. I opened my Roth IRA at 26.

  2. If your wife has a Roth 401k option, keep in mind you can contribute much more than $5K per year. She could contribute up to $16,500 in a Roth 401k this year, regardless of income. Then you could put another $5K into a Roth IRA in your name. This would help you reach your goal much, much faster.

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