Traditional vs Roth IRA Calculator

Personal Finance
Updated Apr 2026 • Has calculator

Comparison of after-tax retirement balances between a Traditional (pre-tax) and Roth (after-tax) IRA.

Calculate Trad vs Roth IRA

Trad vs Roth IRA Formula

Roth Advantage % = (Retirement Tax − Current Tax) ÷ (100 − Retirement Tax) × 100

Annual IRA contribution (2025 limit: $7,000; $8,000 if 50+)

Years until you start withdrawing

Expected nominal annual return on investments

Your current federal marginal income tax rate

Expected tax rate when you withdraw in retirement

Roth Advantage

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Not investment advice.

What is Trad vs Roth IRA?

The core trade-off between a Traditional and Roth IRA is about timing: Traditional contributions are pre-tax (you pay tax on withdrawal), while Roth contributions are after-tax (withdrawals are tax-free). If you expect to be in a higher tax bracket in retirement than today, the Roth wins. If you expect a lower bracket, Traditional wins. At identical tax rates, both are mathematically equivalent. The 2025 combined IRA contribution limit is $7,000 ($8,000 if age 50+).

Worked Example

Worked example — IRS Roth vs Traditional IRA Comparison — 2025

2025

Step 1  Annual contribution: $7,000 | Term: 30 years | Return: 8%
Step 2  Current tax rate: 22% | Expected retirement rate: 25%
Step 3  Traditional after-tax balance: $7,000 × FV annuity × (1−25%) ≈ $590,273
Step 4  Roth balance: $7,000 × (1−22%) × FV annuity ≈ $613,884
Step 5  Roth advantage: +4.0% ($23,611 more after-tax)
Step 6  → Use Roth if taxes are likely to rise; Traditional if taxes will fall

Source: IRS — Traditional and Roth IRAs, Publication 590-A (2025-01-01)

How to Interpret Trad vs Roth IRA

< -10
Traditional clearly better — taxes expected to fall significantly
-10 – -2
Traditional slightly better — lower taxes in retirement
-2 – 2
About equal — marginal tax rates similar
2 – 10
Roth slightly better — taxes expected to rise
> 10
Roth clearly better — taxes expected to rise significantly

📚 Retirement Planning — Complete the path

  1. 401(k) Match
  2. Trad vs Roth IRA
  3. Safe Withdrawal Rate
  4. Medicare IRMAA
  5. HSA Limit
Sources
  1. IRS — Roth vs Traditional IRA, Publication 590-A