Roth vs Traditional IRA Calculator

The Roth side is $7,500, minus your tax rate today, grown at 7%. The Traditional side is $7,500, grown at 7%, minus your tax rate in retirement. Same three numbers, different order — and multiplication does not care about order. When your rate today equals your rate in retirement, the two accounts produce identical spendable dollars. Not similar. Identical, to the cent.

That is the entire decision. Every real argument between Roth and Traditional is an argument about which of those two rates is higher. At the defaults — 22% today, 15% in retirement, 25 years — Traditional wins, leaving about $34,600 against the Roth's $31,750. Drag the retirement rate up past 22% and the bars swap.

Both sides start from $7,500 of pre-tax money, which is the only fair way to run this. A $7,500 Traditional contribution costs you $7,500 of gross pay. Putting the same $7,500 of gross pay into a Roth means paying tax on it first, so the calculator deducts your current rate up front and grows what is left.

If you instead compared $7,500 landing inside each account after tax, the Roth would look artificially better — you would quietly be contributing more total money to it. That is the most common way this comparison gets rigged, usually by accident.

The calculator stops at one contribution and two tax rates. The real decision turns on things it does not model. Required minimum distributions: Traditional balances eventually force taxable withdrawals whether you need the money or not, and Roth IRAs do not. Medicare surcharges: those forced withdrawals raise your income, and income above the IRMAA thresholds raises your Part B and Part D premiums — an effective tax the bracket slider never sees. State income tax: retiring from a high-tax state to a no-tax one is a large, genuine argument for Traditional that lives entirely outside this model.

Then there is the part no calculator solves. You are being asked to predict your marginal rate decades out, under tax law that has not been written yet. If the two rates you would enter are honestly a coin flip, that is itself a useful answer: split your contributions between both. The math says you cannot lose much either way, and you hedge the one variable nobody can forecast.