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Traditional IRA vs Roth IRA

Compare after-tax retirement balances between a Traditional IRA (tax-deferred) and a Roth IRA (tax-free growth) to see which benefits you more.

2024 IRA contribution limit is $7,000 ($8,000 if 50+).

Results

Traditional IRA (Pre-Tax Balance)$711,649.75
Traditional IRA (After-Tax Value)$555,086.80
Roth IRA (After-Tax Value)$711,649.75
Annual Tax Deduction (Traditional)$1,680.00
Roth Advantage / (Traditional Advantage)$156,562.94

📖What is it?

A side-by-side comparison of Traditional and Roth IRAs. Both grow identically before taxes; the difference lies in when you pay tax. Traditional gives a deduction now but is taxed on withdrawal. Roth has no deduction now but withdrawals are 100% tax-free.

🎯How to use

Enter your annual contribution, current tax rate, expected retirement tax rate, expected return, and years to retirement. The calculator projects both accounts and shows the after-tax value of each, plus the dollar advantage of one over the other.

💡Example scenario

Contributing $7,000/year at 7% for 30 years grows to ~$829,000. At a 22% retirement tax rate, the Traditional yields ~$647,000 after tax, while the Roth yields $829,000. The Roth advantage is ~$182,000.

🏆Pro tip

If your current tax rate is higher than your expected retirement rate, Traditional wins. If you expect to be in the same or higher bracket later, Roth wins. Many people hedge by splitting contributions across both account types.