IRA Calculator
Compare traditional and Roth IRAs on an after-tax basis.
About IRA Calculator
The IRA comparison is nuanced because Roth and Traditional IRAs represent different after-tax wealth. A $6,000 Roth contribution costs you $6,000 of after-tax money; a $6,000 traditional contribution effectively costs less because of the upfront deduction. To make a fair comparison, this calculator optionally invests the traditional deduction savings in a taxable account. When tax rates don't change, the two strategies produce identical results — the divergence comes entirely from rate differences between now and retirement.
Formula
Traditional IRA after-tax value
Traditional after-tax = Pre-tax FV × (1 − retirement rate) + Reinvested savings value
- FV_Trad
- Traditional IRA future value (pre-tax)
- t_ret
- Marginal tax rate in retirement
- V_savings
- Future value of reinvested annual tax deductions
Worked example
With the default values below, IRA Calculator returns Roth IRA Value of $609,985. Change any input above and every figure here is recalculated in your browser.
Inputs used
- Annual Contributionaccepts 100–10,000 $
- 6,000 $
- Current IRA Balanceminimum 0 $
- 0 $
- Years to Retirementaccepts 1–50
- 30
- Expected Annual Returnaccepts 0–20
- 7
- Current Tax Rate (%)accepts 0–50
- 22
- Expected Retirement Tax Rate (%)accepts 0–50
- 25
- Invest Traditional Tax Savings?
- Yes
- Capital Gains Rate on Tax Savings Account (%)accepts 0–40
- 15
Results
- Roth IRA Value
- $609,985
- Traditional IRA (After-Tax, incl. reinvested savings)
- $566,935
- Roth Advantage (Deficit)Positive = Roth wins; negative = Traditional wins.
- $43,051
- Traditional After-Tax (Before Reinvested Savings)
- $457,489
- Reinvested Traditional Tax Deduction Value
- $109,446
- Total Contributions
- $180,000
Step by step
- 1Both accounts grow to the same pre-tax value= $609,985
- 2Traditional: tax due at withdrawal= $152,496
- 3Traditional after-tax value (before tax savings)= $457,489
- 4Add: invested traditional tax deduction savings= $109,446Annual tax saving of $1,320 invested in a taxable account.
- 5Traditional total after-tax (incl. reinvested savings)= $566,935
- 6Roth final after-tax value= $609,985Roth withdrawals are entirely tax-free — no deduction at this step.
- 7Roth advantage= $43,051Roth wins because your expected future rate exceeds your current rate.
Assumptions and limits
- The result is derived only from the 8 inputs listed above. Anything not among them is not part of the calculation.
- In particular, this calculator does not take inflation or fees or charges into account.
- Figures are rounded for display to whole numbers, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
- Uses 2024 contribution limits and illustrative tax rates. State taxes are not included. Consult a tax advisor before making IRA contribution decisions.
- This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.
How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.
Uses 2024 contribution limits and illustrative tax rates. State taxes are not included. Consult a tax advisor before making IRA contribution decisions.
Frequently Asked Questions
If tax rates don't change, which IRA is better?
Neither — they're mathematically equivalent when tax rates are the same today and in retirement. The calculator will show zero advantage either way. The choice matters only when rates differ.
What is the 'invest traditional tax savings' toggle?
A traditional IRA contribution saves you taxes today via the deduction. To make the comparison fair, you should invest those savings — otherwise you're comparing a Roth account to a traditional account plus cash sitting idle. When toggled on, the tax savings are invested in a taxable account and added to the traditional IRA's total after-tax wealth.
Does a Roth IRA have required minimum distributions?
No. Roth IRAs are exempt from RMDs during the owner's lifetime. Traditional IRAs must take required minimum distributions starting at age 73. This is another advantage of the Roth for estate planning and tax flexibility in retirement.
Can I have both a Roth and Traditional IRA?
Yes. You can contribute to both in the same year as long as your total contributions don't exceed the annual limit ($7,000 in 2024). Many savers split contributions to hedge against future tax rate uncertainty.