Enter your current age, retirement age, annual contribution, current tax rate, expected retirement tax rate, and investment return. The calculator compares the after-tax wealth at retirement under a Roth IRA vs. a Traditional IRA (or Roth 401k vs. Traditional 401k).

The key insight: Roth wins if your retirement tax rate is higher than your current rate. Traditional wins if your retirement tax rate is lower.

The Roth vs. Traditional decision is fundamentally about when you want to pay taxes — now or later. Getting this right can be worth tens of thousands of dollars over your lifetime.

How They Differ

Traditional IRA/401(k): Contributions are tax-deductible today (you save on current taxes), investments grow tax-deferred, and withdrawals in retirement are taxed as ordinary income. Roth IRA/401(k): Contributions are made with after-tax dollars (no immediate tax break), investments grow tax-free, and qualified withdrawals in retirement are completely tax-free.

The Tax Rate Comparison

If your marginal tax rate is the same in retirement as it is now, Roth and Traditional produce identical after-tax results (this is a mathematical certainty). In practice, most people's tax rates change. Early-career professionals often benefit from Roth (they're in a low bracket now and will be higher later). High earners near peak income may benefit from Traditional (they're in a high bracket now and may drop in retirement).

Flexibility and Other Considerations

Roth accounts offer several advantages beyond the tax math: no Required Minimum Distributions (RMDs) during the owner's lifetime, tax-free inheritance for heirs, and penalty-free withdrawal of contributions at any time. Traditional accounts provide a larger upfront tax deduction, which can be valuable if you're in a high bracket and need to reduce your current-year tax bill.