Roth vs Traditional Calculator: IRA or 401(k)
Free · no sign-up · reviewed September 2026
Roth or Traditional? Both are great retirement accounts; the difference is when you pay tax. A Roth is funded with money you've already been taxed on and comes out tax-free. A Traditional gives you a tax break now and is taxed when you withdraw.
This compares the after-tax value of each, assuming the same cost to you today, so you can see which one actually leaves you with more. The same choice exists in a 401(k), 403(b) or governmental 457(b) at work: switch the account at the top and the contribution limit, the answer and the account it names all follow.
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Your numbers
The tax question is identical in both — pay tax now or pay it later — but the amount you're allowed to put in is not, so the limit below follows whichever you pick.
The catch-up goes by the age you reach this year, not by your birthday. In an IRA it is one extra $1,100 from 50 ($8,600 in total) and nothing more at 60. In a 401(k) it is $32,500 from 50 and $35,750 for the four years you turn 60, 61, 62 and 63, then back to $32,500 at 64 (IRS Notice 2025-67).
Traditional and Roth share one limit — it caps what you put in across both, not each one separately. For 2026 that is $7,500 across your IRAs and $24,500 of your own pay in a 401(k), 403(b) or governmental 457(b); an employer match sits outside it. Anything above the limit is capped in the answer.
Your numbers save automatically on this device. The link opens this calculator with these exact numbers filled in, so you can bookmark a scenario or send it to someone. Printing gives you a clean sheet of just your numbers and the answer.
Which comes out ahead
It's basically a tie
Same after-tax result at these tax rates
💡 At the same tax rate now and in retirement, the two are mathematically identical. The tie-breakers are flexibility: a Roth IRA has no required withdrawals, and your contributions can come out penalty-free.
$708,456
Roth (after-tax)
tax-free at withdrawal
$708,456
Traditional (after-tax)
taxed at withdrawal
$0
Difference
after taxes
- Roth (after-tax)$708,456
- Traditional (after-tax)$708,456
- Yearly contribution
- $7,500
- Roth after-tax value
- $708,456
- Traditional after-tax value
- $708,456
- Difference
- $0
- Your tax rate now
- 22%
- Tax rate in retirement
- 22%
Roth vs Traditional Calculator · Far Better Off
https://farbetteroff.com/calculators/roth-vs-traditional-calculator
Open that link to get this calculator back with these exact numbers. Estimates for education only — Far Better Off is not a lender or a financial advisor, and these results are not financial advice.
The 2-minute guide
It comes down to your tax rate
If your tax rate will be higher in retirement than it is now, the Roth usually wins: pay tax at today's lower rate and never again. If your rate will be lower later, the Traditional usually wins: skip tax now at your high rate and pay less later. Same rate both times and they tie.
Why we assume the same cost today
A dollar in a Roth is already taxed, while a dollar in a Traditional is pre-tax. To compare fairly, this calculator matches what leaves your pocket today, so a Traditional contribution is scaled up by your tax break. That's the apples-to-apples version.
Roth's hidden perks, and which of them your account actually has
Beyond the math, no Roth account makes you take money out in your lifetime: the IRS's RMD FAQ says "the RMD rules do not apply to Roth IRAs or Designated Roth accounts while the owner is alive", which for a Roth 401(k) has only been true since 2024 (SECURE 2.0 § 325). Taking money out early is where the two part company. A Roth IRA pays your contributions back first, so what you put in can come out anytime without tax or penalty. A Roth 401(k) does neither: the plan decides whether it may pay you at all while you still work there, and a non-qualified withdrawal comes out part contribution and part earnings, in the same proportion as the account — the IRS's own example splits a $5,000 withdrawal into $4,700 and $300. If that flexibility is what's breaking the tie for you, it's an argument for the IRA specifically.
What you're allowed to put in
For 2026 the IRS caps an IRA at $7,500 a year across traditional and Roth combined, or $8,600 from the year you turn 50. A 401(k), 403(b) or governmental 457(b) is a different and much higher limit on your own deferrals: $24,500, $32,500 from 50, and $35,750 for the four years you turn 60 through 63. In both cases it is one limit across Roth and traditional, not one each — and in an IRA you also can't contribute more than you earned. This calculator caps whatever you type at the limit rather than projecting a contribution you couldn't make.
Many people do both
Splitting contributions between Roth and Traditional hedges your bet against unknown future tax rates and gives you flexible pots to draw from in retirement. You don't have to pick just one.
Frequently asked questions
Is a Roth or Traditional IRA better?
It depends on your tax rate now versus in retirement. Roth wins if you'll be in a higher bracket later; Traditional wins if you'll be lower. At equal rates they're mathematically identical, so Roth's extra flexibility often breaks the tie.
Is Roth or Traditional better in a 401(k)?
It's the same question and the same arithmetic — pay tax now or pay it later — and this calculator answers it for a 401(k), 403(b) or governmental 457(b) as soon as you switch the account at the top. Three things differ from an IRA: the limit is much higher ($24,500 of your own pay in 2026, rather than $7,500), you can't take your contributions back out the way a Roth IRA lets you, and your employer's match is separate money. A plan may let a match be Roth (SECURE 2.0 § 604), but it doesn't have to, so many savers who choose Roth still build a pre-tax pot from the match alone.
What's the actual difference between them?
Timing of taxes. A Roth is funded with after-tax money and withdrawals are tax-free. A Traditional is funded with pre-tax money (a deduction now) and withdrawals are taxed as income in retirement.
Should young people choose Roth?
Often yes. Early in a career your tax rate tends to be lower than it will be later, so paying tax now at that lower rate and growing everything tax-free for decades is a strong combination.
Can I contribute to both?
Yes, as long as your combined contributions stay within the one annual limit — $7,500 across your IRAs in 2026 ($8,600 from the year you turn 50), or $24,500 of your own pay in a 401(k). Many people split between the two to diversify their future tax exposure.
How much can I contribute in 2026?
Into an IRA, $7,500 — up from $7,000 in 2025 — plus a $1,100 catch-up from the year you turn 50, for $8,600. Into a 401(k), 403(b) or governmental 457(b), $24,500 of your own pay, $32,500 from 50, and $35,750 in the four years you turn 60, 61, 62 and 63 — a SECURE 2.0 catch-up that exists only in a workplace plan, never in an IRA. Your employer's match doesn't count against your limit. Figures from IRS Notice 2025-67.
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