Roth vs Traditional IRA Calculator

How to use this calculator

• Enter your planned annual contribution (the 2026 limit is $7,500 / $8,500 over 50).
• Enter years until withdrawal — usually retirement age minus current age.
• Set current marginal tax rate (federal + state, your top bracket today).
• Set retirement marginal tax rate — usually 2-5 pp lower than today's rate because retirement income is typically lower than peak earning years.
• Leave "invest tax savings" set to YES for the apples-to-apples comparison.

About this calculator

Roth and Traditional IRAs are mathematically equivalent if your tax rate is the same now and at retirement. They diverge when those rates differ: lower tax rate now favours Roth (pay tax cheaply now, withdraw free later); lower tax rate at retirement favours Traditional (defer tax to a cheaper bracket). The honest comparison invests the Traditional's up-front tax savings in a taxable brokerage at the same return — otherwise Roth looks artificially worse just because it costs more out-of-pocket per year. The IRS contribution limit ($7,500 under 50 / $8,500 over 50 for 2026) is identical for both, and that limit is in after-tax dollars for Roth but pre-tax for Traditional, which is the mathematical core of the comparison. Real-world considerations not modeled here: required minimum distributions (RMDs) apply to Traditional but NOT to Roth (a meaningful advantage for estate planning); income limits restrict direct Roth contributions above ~$165k single / $246k MFJ in 2026 (the backdoor-Roth conversion is the workaround); state taxes on the Traditional withdrawal vary widely.

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