How Much Money Should You Contribute to Your Roth IRA?

How much you contribute depends on your budget and retirement goals

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With a Roth IRA (individual retirement account), you use income already taxed to save for retirement. The profits you earn on contributions will be tax-free if you withdraw your investment earnings under the right circumstances—at least 59½, with the account open for at least five years.

For tax year 2022, you can generally contribute up to $6,000 annually if you are under the age of 50 and $7,000 if you are 50 or older—unless you’re at certain income limits, filing limitations, or contribute to another type of IRA. But if you’re wondering how much you should contribute to your Roth IRA, keep reading for more insight and expert advice. 

Key Takeaways

  • You can generally contribute up to $6,000 or $7,000 per year to a Roth IRA (contribution limits vary by income and age, and may change each tax year).
  • Maxing out your annual Roth IRA contributions is one of the best ways to impact your retirement savings. 
  • If you overcontribute to your Roth IRA, you can run into penalty taxes.

How Much Should You Put in Your Roth IRA?

The ideal amount to contribute to a Roth IRA is $6,000 (or $7,000 if you are 50 or older) in 2022, or up to the contribution limits of your income.

Chloe Elise, CEO, founder, and financial coach at Deeper Than Money, told The Balance over email that she recommends maxing out your Roth IRA whenever possible, and it’s essential to do so early in your career. 

Contributing early serves several purposes. Your contributions and earnings have time to grow and recover from the market's inevitable downturns. If your income increases beyond a certain threshold as your career advances, the amount you can contribute to Roth decreases. Eventually, you may not be able to contribute at all. 

When you pull out your contributions and earnings at retirement, you have a larger pool of money that you won’t pay taxes on.

“It is a great tool, especially for someone who is younger and in a lower tax bracket than they expect to be in retirement,” Elise said.

The financial services company Fidelity suggests saving 15% of your annual income for future retirement, although that percentage is based upon starting at age 25 and other variables. If you’re starting later, you may need to save more. It’s estimated that every decade of delay in investing can triple the amount needed to reach a financial goal.

Saving in a Roth IRA Without Much Money

Maxing out your annual contributions is difficult if you're on a tight budget. So Elise suggests creating an automatic contribution of as little as $50 per month. While small, it’s a start and a good habit to build.

“Setting up your Roth IRA and becoming familiar with how to invest is sometimes the biggest challenge,” Elise said.

Look at your monthly budget, and make room for a Roth IRA contribution as a fixed cost like rent or a car insurance payment. Again, even if it’s only a small amount, prioritizing that contribution will pay off as compounding comes into play. 


To get a general idea of how your savings can compound in a Roth IRA, check out this compound interest calculator.

“The amount should be whatever can fit in the budget and can be increased over time,” Mike Hunsberger, a chartered financial consultant and owner of Next Mission Financial Planning, LLC, told The Balance over email. 

So your initial contributions of $50 per month can increase as your salary grows—until your income hits the Roth contribution ceiling.  

Should You Max Out Your Roth IRA Contributions?

If you can afford to max out your Roth IRA contributions, your efforts pay off down the road. According to Hunsberger, maxing out is 100% worth it, especially if you’re in a tax bracket now lower than one you might be in when retired.

Elise agrees, thanks to the tax savings that come with a Roth IRA.

“Usually when people are asked if they think taxes will be lower or higher in retirement, their guess is higher," Elise said. "This makes it a no-brainer to take advantage of a lower tax bracket today by utilizing a Roth IRA and letting it grow tax-free in the future.”


If you also contribute to a traditional IRA, ensure you’re not exceeding the total IRA contribution cap.

Should You Prioritize a Roth IRA Over Other Retirement Accounts?

As great as Roth IRAs are, if you have access to an employer-sponsored 401(k) with an employer contribution match, you may want to focus on contributing to that account first. 

“Always prioritize your employer match, first and foremost,” Elise said. “You want to get every free dollar from your employer possible.” 

Elise advised checking if your employer offers a Roth 401(k). If not, after putting enough in your 401(k) to get the match, she suggested maxing out your Roth IRA as long as you can because you can’t contribute after your adjusted gross income is too high. 


Contributions made to a 401(k) can reduce your taxes for the year you’ve contributed. You may also be able to deduct contributions to a traditional IRA (not a Roth) if you meet specific criteria. Speak with your tax advisor for more information or details. 

When To Contribute to a Roth IRA

Let’s examine the timing around contributing to a Roth IRA.

Right Now

The best way to prepare for retirement is to start saving right now. The sooner you begin to save in an investment account, the longer your investment earnings will have to compound and grow. If you’re already saving, now is also a great time to evaluate if you can afford to increase your contributions. However, if you’re 50 or older, you can also make an annual catch-up contribution of up to $1,000 to a Roth IRA.

Before the Tax-Filing Deadline 

If you regret not contributing to a Roth IRA last year or wish you had maxed out your contributions, you still have time to make contributions, as long as you do so by the tax filing due date, generally on April 15.

Frequently Asked Questions (FAQs)

How do I contribute to my Roth IRA?

To contribute to a Roth IRA, open a Roth IRA account through a financial institution. Either make a deposit or set up regular automatic contributions directly from your paycheck or bank account. You’ll also need to choose how you want to invest your contributions.  

What happens if I contribute too much to my Roth IRA?

If you contribute more than the limit to your Roth IRA, you may run into a penalty or additional tax. If you realize that you over contributed before filing your tax return, you withdraw the excess contributions. If you wait until after filing your tax return to take action, remove your excess contributions and file an amended return within six months to avoid penalty taxes. If you didn’t run afoul of contribution limits but still feel you’ve overextended yourself with contributions, you could withdraw those contributions. However, you can’t take out any profits on those contributions without penalty until you meet the requirements.

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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. FINRA. "Individual Retirement Accounts."

  2. IRS. "Retirement Topics - IRA Contribution Limits."

  3. Fidelity. "How Much Should I Save For Retirement?"

  4. State of New Jersey Department of Education. "Saving and Investing Strategies and Influences."

  5.  IRS. "Retirement Topics - Catch-Up Contributions."

  6. IRS. "Publication 590-A (2021), Contributions to Individual Retirement Arrangements (IRAs)."

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