Roth vs Traditional IRA Calculator – Compare After Tax Savings

Choosing between a Roth IRA and a traditional IRA is mostly a question of when you want to pay taxes on your retirement savings. This Roth vs traditional IRA calculator lets you plug in your current age, contribution amount, expected tax rates, and investment return so you can see a side by side estimate of your after tax balances at retirement.

How to use the Roth vs traditional IRA calculator

The calculator on this page is built to stay simple while still highlighting the most important drivers of your Roth versus traditional IRA decision. You enter the same out of pocket annual contribution for both account types, then choose how long you will invest and what tax rates you expect now and in retirement. The calculator shows your estimated Roth and traditional IRA balances after tax at retirement, plus the projected difference between the two choices.

Start with your current age and the age when you would like to retire. The difference between these values is the number of years the calculator uses to grow your investments. Keeping the time horizon realistic is important. For example, a 35 year old planning to retire at 65 has a 30 year investing window, which is long enough for compound growth to have a large effect on results. Extremely short periods of just a few years will make the differences between Roth and traditional much smaller.

Next, enter your annual contribution. This is the amount you are willing to invest each year out of pocket, after considering your monthly budget. The calculator uses that same dollar amount for both Roth and traditional scenarios. It treats Roth contributions as after tax dollars, while traditional IRA contributions are adjusted to reflect the upfront tax deduction in a simplified way. The goal is to compare apples to apples by keeping your yearly cost to fund either account the same.

In the tax section, you enter a current marginal tax rate and an expected retirement tax rate. Marginal tax rate means the rate that applies to the next dollar of income you earn, after accounting for federal and state income taxes. For many households this is in the 12 percent to 24 percent range, but higher or lower values are possible. The retirement tax rate is your best guess for the tax rate that will apply to your IRA withdrawals later. If you believe your income will fall and you will be in a lower bracket, you can set this lower than your current rate. If you expect higher income or higher tax rates in the future, you might set this higher instead.

Finally, choose an expected annual return. The calculator assumes a steady average return each year for both Roth and traditional balances. It does not try to predict the stock market. Many retirement planning examples use a long term average between 5 percent and 8 percent for a diversified portfolio, but you should use a number that matches your own risk tolerance. The calculator limits extremely high return entries to keep projections reasonable.

As you adjust these inputs, the calculator automatically updates three key numbers:

• The estimated Roth advantage at retirement, which is the projected Roth IRA balance minus the projected traditional IRA balance after taxes.
• Your projected Roth IRA after tax balance at retirement.
• Your projected traditional IRA after tax balance at retirement, after applying your retirement tax rate to withdrawals.

A simple line chart under the details card shows how the after tax values of the Roth and traditional IRA evolve over time for your assumptions. The Roth line is drawn in blue and the traditional line in green so it is easy to see which account type is ahead at each point on your path to retirement.

Roth vs traditional IRA: how taxes change your result

From a tax perspective, a Roth IRA and a traditional IRA are mirror images. With a traditional IRA, you may be able to deduct your contributions now, which can reduce your taxable income for the year. In return, your withdrawals in retirement are taxed as ordinary income. With a Roth IRA, you contribute after tax dollars and do not get a deduction today, but qualified withdrawals of contributions and earnings in retirement are tax free under current law. Because of this trade off, the key question is whether your tax rate will be higher now or later.

The calculator models this trade off by assuming you invest the same out of pocket amount in either account. For the Roth IRA, that full amount is invested each year and grows tax free. For the traditional IRA, the calculator increases the pre tax contribution so that, after the deduction, your out of pocket cost is similar to the Roth. At retirement, it applies your chosen retirement tax rate to the entire traditional IRA balance to estimate what you would keep after taxes if you withdrew the funds.

If your retirement tax rate is lower than your current rate, the traditional IRA often comes out ahead. You receive a larger tax break up front when your rate is higher, invest more on a pre tax basis, and then pay tax at a lower rate when you withdraw. If your retirement tax rate is higher than your current rate, a Roth IRA can be more attractive because you lock in a lower rate now, pay the tax once, and then avoid taxes on qualified withdrawals later. When your current and retirement tax rates are similar, the long term results can be very close, and other features of Roth and traditional IRAs may drive your decision.

The calculator does not enforce IRS contribution limits or income phase outs. It lets you test scenarios based on the cash you are willing to invest each year. In real life, annual IRA contributions are capped by federal law and may be limited further by your age and income. The tool also does not model required minimum distributions, early withdrawal penalties, or detailed rules such as five year clocks for Roth earnings. You should treat the results as a way to build intuition, not as a complete tax analysis.

Using the calculator to guide your retirement planning

You can use the Roth vs traditional IRA calculator in several ways. One approach is to start with your best guess for current and retirement tax rates, then try a few different values to see how sensitive your results are to those assumptions. If a small change in your expected retirement tax rate flips the advantage between Roth and traditional, that is a sign that the long term difference may be modest and that other factors should carry more weight in your decision.

Another useful exercise is to compare different contribution levels. For example, you might start with a contribution that matches current IRA limits and then test a higher amount to see how much additional long term growth you get by increasing your savings rate. In many cases, the choice between Roth and traditional is less important than making sure you are contributing consistently over time and staying invested in an appropriate portfolio for your risk tolerance.

You can also pair this calculator with a standard Roth IRA growth calculator or a broader retirement savings calculator. That way you first get a sense of how much you may need at retirement to support your spending, and then use this tool to decide what mix of Roth and traditional accounts might help you get there in a tax efficient way. Some savers deliberately split contributions between the two types to build tax flexibility and reduce the risk of being wrong about future tax rates.

Remember that account rules matter too. Traditional IRAs are subject to required minimum distributions at a certain age for most owners, which means you can be forced to take taxable withdrawals even if you do not need the cash that year. Roth IRAs do not require minimum distributions for the original owner under current law, which can make them a powerful tool for leaving assets to heirs or managing taxable income in retirement. On the other hand, the ability to deduct traditional IRA contributions today may be very valuable if you are in a high bracket and need the immediate tax relief.

The right answer is often personal. Someone early in their career with modest income, expecting higher earnings later, may lean toward Roth contributions. Someone close to retirement in a high tax bracket who expects much lower income later may lean toward traditional contributions. Many households use both, contributing to a traditional IRA or 401(k) enough to capture employer matches and deductions, then adding Roth contributions when they can.