Should you pay taxes now or later? A Roth IRA is funded with after-tax dollars — you get no deduction today, but every dollar of growth comes out tax-free in retirement. A Traditional IRA works the opposite way: contributions may be tax-deductible now, the balance grows tax-deferred, and you pay ordinary income tax on withdrawals later. This Roth vs Traditional IRA calculator projects both accounts to your retirement age at your assumed return, then taxes the Traditional balance at your expected retirement rate so you compare true after-tax dollars — everything runs privately in your browser; nothing is uploaded or stored.
The math contains a beautiful surprise that most retirement articles gloss over: if your tax rate is identical now and in retirement, Roth and Traditional produce exactly the same after-tax result. Multiplication commutes — growing the full amount and taxing at the end (Traditional) is the same as paying the tax first and growing the remainder (Roth). That means the entire debate collapses to a single question: will your marginal tax rate be higher, lower, or the same in retirement? Early-career earners in low brackets and anyone expecting higher future income tilt Roth; peak earners who expect a quieter, lower-income retirement tilt Traditional. The calculator shows your break-even rate — the retirement tax rate at which both choices tie.
One subtlety makes most online comparisons misleading: equal contributions are not a fair comparison. A $7,500 Roth contribution costs $7,500 of your after-tax money, while a $7,500 deductible Traditional contribution only costs $7,500 minus the tax you saved — at a 24% rate, just $5,700 out of pocket. Switch to "fair" mode and the calculator grosses up the Traditional contribution (dividing by 1 minus your current tax rate) so both options cost you the same today, then compares what each leaves you after retirement taxes.
How to use the Roth vs Traditional IRA Calculator
- Enter your ages: your current age and the age you plan to retire — this sets the compounding horizon.
- Enter your annual contribution and an expected annual return (7% is a common long-term equity assumption; use a lower figure for conservative portfolios).
- Set your tax rates: your current marginal rate and your best estimate of your marginal rate in retirement. If you're unsure, try a few scenarios.
- Choose the comparison method: "Equal contribution" mirrors a fixed annual budget into the account; "Fair: equal out-of-pocket cost" adjusts for the Traditional deduction's tax savings.
- Press Compare to see each account's after-tax retirement balance, the winner, and your break-even retirement tax rate.
Tips for choosing between Roth and Traditional
- Young and in a low bracket now? Lock in today's low rate with Roth contributions — you're paying the cheapest tax you'll ever see.
- In your peak earning years? The Traditional deduction is worth more when your marginal rate is high, especially if retirement income will be lower.
- You can hedge: the $7,500 combined 2026 limit ($8,600 at 50+) can be split between both accounts, giving you tax diversification.
- Remember the Roth income phase-outs: for 2026, direct contributions phase out at $153,000–$168,000 (single) and $242,000–$252,000 (married filing jointly) — high earners above that use the backdoor Roth instead.
What this comparison leaves out
This calculator keeps the core trade-off clean, so a few real-world factors are simplified: it assumes your Traditional contributions are fully deductible, ignores Roth conversion strategies and Social Security taxation, and doesn't model required minimum distributions — which Traditional IRAs trigger at age 73 (75 for those born in 1960 or later) but Roth IRAs never require of the original owner. It also treats "retirement tax rate" as a single marginal rate, while real retirements blend brackets, standard deductions, and state taxes. Use the result as a directionally correct guide, not a final answer.
Frequently asked questions
Which is better, a Roth or Traditional IRA?
Neither is universally better — it depends on your tax rates. If your marginal tax rate is the same now and in retirement, both give you the identical after-tax result. The Roth wins when your retirement tax rate is higher than today's; the Traditional wins when your retirement tax rate is lower. Run your numbers above to see which wins for you.
Why is the Roth vs Traditional comparison unfair with equal contributions?
Because a $7,500 Roth contribution costs you $7,500 of after-tax money, while a $7,500 deductible Traditional contribution only costs $7,500 minus your tax savings. For an apples-to-apples comparison, the Traditional contribution should be "grossed up" — divided by (1 minus your current tax rate) — so both options cost the same out of pocket. This calculator's fair mode does that automatically.
Can I contribute to both a Roth and a Traditional IRA in the same year?
Yes. You can split contributions between both account types, but the $7,500 combined limit for 2026 ($8,600 if you are 50 or older) applies across all your IRAs together — you cannot contribute the full limit to each.
Who is a Traditional IRA best for?
Traditional IRAs favor high earners in peak earning years who expect to retire into a lower tax bracket, and anyone who needs the upfront tax deduction today. Note that deductibility can be reduced or eliminated if you or your spouse is covered by a workplace retirement plan and your income is above IRS thresholds.
What is the Roth IRA income limit for 2026?
Direct Roth IRA contributions phase out for 2026 at modified adjusted gross incomes of $153,000–$168,000 for single and head-of-household filers, and $242,000–$252,000 for married couples filing jointly. Above those ranges, earners typically use the backdoor Roth strategy.
All calculations are estimates for personal use. This tool is not financial advice; tax rules change — verify limits and eligibility with the IRS or a tax professional.