Roth IRA vs Traditional IRA calculator
Compare Roth IRA and Traditional IRA future growth, tax savings, and after-tax retirement income based on current and future tax brackets.
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Funded with after-tax money today. All withdrawals in retirement are 100% tax-free.
Saves $ in taxes today, but subject to $ in retirement income taxes.
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About this tool
Compare the long-term wealth building power of a Roth IRA versus a Traditional IRA. Evaluates annual contributions up to IRS limits ($7,000 or $8,000 for age 50+), upfront tax deductions today versus 100% tax-free compounding and withdrawals in retirement, and provides a clear recommendation based on your current and expected retirement tax brackets.
How to use it
- 1 Enter your planned annual contribution amount ($7,000 maximum for 2024).
- 2 Enter your current age and your anticipated retirement age.
- 3 Enter your current marginal tax bracket and your expected tax bracket at retirement.
- 4 Specify your anticipated average annual investment rate of return.
- 5 Compare total after-tax wealth accumulation, taxes paid, and optimal IRA choice.
Questions
Should I choose a Roth IRA or Traditional IRA?
As a rule of thumb, if you expect your tax bracket to be higher in retirement than it is today, a Roth IRA is generally superior because withdrawals are tax-free. If you expect a lower tax bracket in retirement, a Traditional IRA provides valuable tax deductions today.
What is the 2024 IRA contribution limit?
For 2024, the maximum annual contribution to all your traditional and Roth IRAs combined is $7,000 ($8,000 if you are age 50 or older).
Is my data uploaded?
No. This tool runs in your browser, so your text and files never reach our server.
Is this tool free?
Yes. It’s free to use with no sign-up and no limits for normal use.
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