Investment Calculator — Texas 2026
Calculate compound investment growth as a Texas resident. Texas has no state income tax — investment returns face federal capital gains taxes only.
Quick Answer
A $10,000 initial investment with $500/month at 7% annual return grows to approximately $566,764 in 20 years — on $130,000 of total contributions. As a Texas resident with no state income tax, your investment gains are only subject to federal capital gains rates (0%, 15%, or 20% for long-term gains).
Your Investment Details
S&P 500 historical avg: ~10% nominal, ~7% inflation-adjusted
Investment Results — 20 Years
Final Balance
$300,851
Total Invested
$130,000
Investment Gains
$170,851
$130,000 invested over 20 years grows to $300,851 at 7% annual return. Compound interest generates $170,851 — 131% in gains on top of your contributions.
Year-by-Year Growth
| Year | Total Invested | Investment Gains | Balance |
|---|---|---|---|
| Year 1 | $16,000 | $919 | $16,919 |
| Year 5 | $40,000 | $9,973 | $49,973 |
| Year 10 | $70,000 | $36,639 | $106,639 |
| Year 15 | $100,000 | $86,971 | $186,971 |
| Year 20 | $130,000 | $170,851 | $300,851 |
Investment Tax Overview — Texas
State capital gains tax rate: 0%
Federal long-term capital gains rate: 0% / 15% / 20% (based on income)
Best tax strategy for Texas investors: Roth IRA and 401k still beneficial for federal tax savings
Texas has no state income or capital gains tax — investment returns face federal tax only.
Investment FAQs — Texas
How are investment gains taxed in Texas?
Texas has no state income or capital gains tax — investment returns face federal tax only. At the federal level, long-term capital gains (assets held over 1 year) are taxed at 0%, 15%, or 20% depending on income. Short-term gains (assets held under 1 year) are taxed as ordinary income. Texas adds no state tax — only federal capital gains taxes apply.
What is a good investment strategy for Texas residents?
For Texas investors, tax-advantaged accounts (Roth IRA, 401k) are especially powerful because they eliminate capital gains taxes entirely. Since Texas has no state capital gains tax, taxable brokerage accounts are more attractive here than in high-tax states — you only pay federal capital gains rates.
How much should I invest per month in Texas?
Most financial planners recommend saving 10–15% of gross income for retirement. In Texas, a common starting point: 1) Contribute to your 401k up to the employer match (free money). 2) Max your Roth IRA ($7,000/year or $583/month in 2026). 3) Return to 401k up to the $23,500 annual limit. 4) Then invest in a taxable brokerage. Even $200/month at 7% annual return grows to $227,000 in 30 years — start now regardless of amount.
Is it better to invest in a Roth IRA or taxable brokerage in Texas?
Almost always max the Roth IRA first (up to $7,000/year in 2026). Even in Texas with no state capital gains tax, a Roth IRA eliminates federal capital gains taxes on all growth — a significant advantage for long-term investors. After maxing the Roth IRA and 401k, a taxable brokerage account gives unlimited investment flexibility.
What is the average stock market return for Texas investors?
The US stock market return is the same regardless of state — state taxes affect your net return, not the market's gross return. The S&P 500 historical average: approximately 10–11% nominal annually, or 7% inflation-adjusted (real return). For a diversified portfolio: 5–6% real return is a conservative estimate. Use 7% for long-term projections — it's the standard used in financial planning and IRS 401k disclosures. With no Texas state tax, your net returns on taxable investments are only reduced by federal capital gains taxes.