How Much Could You Have for Retirement if You Invest $7,500 Annually?

If you contribute the 2026 individual retirement account (IRA) limit of $7,500 every year from age 27 to 67, investing fully in an S&P 500 index fund, you could end up with roughly $1.38 million, assuming that past annual inflation-adjusted returns match future ones.

A more conservative 60/40 portfolio of U.S. stocks and bonds, respectively, would yield a much smaller nest egg-just over $882,000-with an average annual return of 4.89%.

In 2026, you can contribute up to $7,500 to your IRA, according to the Internal Revenue Service (IRS). (If you’re 50 or older, you can contribute $1,100 more as a catch-up contribution.) So we wondered: If you contributed $625 per month just to your IRA, would you have enough money to retire in the future?

Well, letS run the numbers. Let’s assume you start saving for retirement at age 27.

Investing in the S&P 500: A Path to retirement

When it comes to investing for the future, putting your money entirely into an S&P 500 index fund could give you the best results. The S&P 500 is made up of the 500 largest companies in the U.S., based on their size.

if you start at age 27 and invest $7,500 each year in an S&P 500 fund, you could have around $1.38 million by age 67. This assumes the average yearly return from 1957 to 2025 continues – that return was 6.69% after accounting for inflation.

Investing only in an S&P 500 index fund has the potential to earn you more money than a 60/40 portfolio. A 60/40 portfolio includes safer investments,like bonds. Though, investing everything in stocks also means your portfolio’s value can go up and down more quickly.

If you chose a 60/40 portfolio rather, you’d likely have a smaller amount saved for retirement. Data from the CFA Institute shows this type of portfolio had an average inflation-adjusted return of just 4.89% from 1901 to 2022. With this more conservative approach, you would have just over $882,000 at age 67.

Whether $882,000 or $1.38 million is enough for retirement depends on things like your desired lifestyle in retirement.