Roth vs Traditional IRA Calculator
See exactly which IRA wins after taxes — with year-by-year growth comparison.
| Age | Year | Roth Balance | Roth After-Tax | Trad Balance | Trad After-Tax |
|---|
| Retirement Tax Rate | Roth After-Tax | Trad After-Tax | Difference | Winner |
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How to Use This Roth vs Traditional IRA Calculator
Enter your current age, planned retirement age, and annual contribution amount. Then set your expected annual return, current marginal tax rate, and estimated retirement tax rate. Hit Calculate Comparison to see a complete side-by-side analysis including after-tax balances, year-by-year growth, and multiple tax scenarios.
The key output is the after-tax balance at retirement — this is what you actually get to spend. For Roth IRAs, that's the full balance. For Traditional IRAs, it's the balance minus taxes you'll owe on withdrawal.
Why This Matters
Choosing between a Roth and Traditional IRA is one of the most impactful financial decisions you can make — and it's surprisingly nuanced. The right choice depends entirely on whether your tax rate is higher now or in retirement.
Consider a 30-year-old contributing $6,500/year at a 7% return for 35 years. If their tax rate stays at 22%, both accounts produce roughly the same after-tax balance. But if they expect to be in a higher bracket at retirement — say a 28% rate — the Roth wins by over $80,000. If they drop to a 15% bracket, the Traditional wins.
High earners who can't deduct Traditional IRA contributions (due to income limits) should lean heavily Roth. Young people early in their careers who expect income to grow should often favor Roth. Those approaching peak earnings or planning to retire into lower-income years tend to benefit from Traditional. This calculator surfaces that difference concretely.
There's also the flexibility angle: Roth IRAs have no required minimum distributions (RMDs), making them superior for estate planning or for retirees who don't need the income immediately.
How It's Calculated
Roth IRA: You contribute after-tax dollars, so the contribution is reduced by your current tax rate. The account grows tax-free, and the full balance is available at retirement.
Roth After-Tax Value = Annual Contribution × FV Factor (after-tax dollars, tax-free growth)
Traditional IRA: You contribute pre-tax dollars (the full amount goes in). The account grows tax-deferred. At withdrawal, you owe taxes on the full balance.
Traditional After-Tax Value = Balance × (1 − Retirement Tax Rate)
The future value factor uses: FV = C × [((1+r)^n − 1) / r] where C is annual contribution, r is the annual return rate, and n is the number of years.
For an apples-to-apples comparison, we compare equal pre-tax dollars committed — meaning the Traditional IRA receives the full contribution while the Roth receives the after-tax equivalent.
Tips & Common Mistakes
- Don't just look at the balance — look at after-tax value. A $1M Traditional IRA is worth far less than a $1M Roth IRA once you account for withdrawal taxes.
- Your "retirement tax rate" is harder to predict than you think. Factor in Social Security, pensions, RMDs from 401(k)s, and potential state tax changes.
- Roth conversions are a third option. If you have a Traditional IRA, you can convert it to Roth during low-income years — this calculator helps you see the long-term payoff.
- Income limits apply. In 2024, Roth IRA contributions phase out at $146,000–$161,000 (single) and $230,000–$240,000 (married). Traditional IRA deductibility phases out if you have a workplace plan.
- Time horizon matters enormously. The longer you invest, the more valuable tax-free compounding becomes in a Roth. Run this calculator at different ages to see the difference 5 extra years makes.