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Roth vs. Traditional IRA Calculator

This Roth vs. Traditional IRA Calculator helps you compare the future value of your retirement savings in both account types, factoring in taxes and compound growth.

Compare Roth and Traditional IRA Growth

Input Fields
P
$
Enter annual IRA contribution amount
n
years
Number of years until retirement
r
%
Estimated average return on investments
%
Estimated tax rate in retirement for Traditional IRA

Roth vs. Traditional IRA Formulas

Formula
\[ FV_{\text{Traditional}} = P \times \frac{(1 + r)^n – 1}{r} \] \[ \text{After Tax} = FV_{\text{Traditional}} \times (1 – t_{\text{retire}}) \] \[ FV_{\text{Roth}} = P \times \frac{(1 + r)^n – 1}{r} \]

Where:

  • $$P$$ = Annual contribution amount
  • $$r$$ = Annual interest rate (as decimal)
  • $$n$$ = Number of years until retirement
  • \( t_{\text{retire}} \) = Expected tax rate in retirement
  • \( FV_{\text{Traditional}} \) = Future value of Traditional IRA
  • $$After Tax$$ = Amount left after paying taxes on Traditional IRA withdrawals
  • \( FV_{\text{Roth}} \) = Future value of Roth IRA (already tax-free)


Roth IRA – Calculation Example

Suppose:

  • Annual contribution = $6,000
  • Interest rate = 7%
  • Years = 30
  • Retirement tax rate = 20%

Calculation:

  1. $$FV = 6,000 \times \frac{(1 + 0.07)^{30} – 1}{0.07} \approx 566,760$$
  2. $$\text{Traditional After Tax} = 566,760 \times (1 – 0.20) = 453,408$$
  3. $$\text{Roth} = 566,760 \ (\text{tax-free})$$

So, Roth IRA would give you $566,760, while Traditional IRA would give $453,408 after tax.


This calculator helps you decide whether a Roth or Traditional IRA is more beneficial in the long term. It assumes equal contributions and investment growth, showing the impact of retirement tax rates on Traditional IRA withdrawals. Use it for side-by-side comparison and smarter retirement planning.

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