Roth vs traditional calculator
Enter your rates, your horizon, and what you would contribute. This grows both wrappers, invests the traditional contribution's tax saving in a taxable account and taxes it along the way, then solves the future marginal rate at which the two finish level.
Worked example — Roth finishes ahead by: $5,908. $7,000 at the 2025 IRA limit, 30 years, 7% return, both rates 24%
2025 IRA limit, equal rates: The real 2025 IRA limit, already the classic textbook wash scenario.
Advanced options 3
The side account earns 5.25% a year after the annual tax drag you entered, against 7.00% inside either wrapper, and pays 15% on its remaining gain at the end. Set both of those to zero and the table collapses to the textbook answer, where the two wrappers tie at exactly your current rate. Rates are taken as given: this page does not determine anyone's bracket.
The limit is a nominal number, so $7,000 of after-tax money in a Roth shelters the same exposure as $9,211 of pre-tax money. The traditional saver can only get $7,000 of that inside the wrapper. Growth on the $2,211 left outside is worth $5,908 over 30 years, and that is the part of this comparison almost no calculator makes.
Roth advantage by future tax bracket, at the 2025 contribution limit
At the real $7,000 IRA limit, 7% return, and 30 years, here is the Roth advantage at each future marginal tax rate.
| Future tax rate | Roth, after tax | Traditional plus side account | Roth advantage |
|---|---|---|---|
| 0% | $53,286 | $60,166 | -$6,880 |
| 5% | $53,286 | $57,502 | -$4,216 |
| 10% | $53,286 | $54,837 | -$1,552 |
| 15% | $53,286 | $52,173 | +$1,113 |
| 20% | $53,286 | $49,509 | +$3,777 |
| 25% | $53,286 | $46,844 | +$6,441 |
| 30% | $53,286 | $44,180 | +$9,106 |
| 35% | $53,286 | $41,516 | +$11,770 |
| 40% | $53,286 | $38,852 | +$14,434 |
Is Roth vs traditional really a wash?
In the textbook framing, where each saver puts in the same pre-tax dollar, the two wrappers are an exact wash at equal rates: $0 difference here, at 24% now and in retirement. But a contribution limit is stated in nominal dollars, not pre-tax dollars. A saver actually contributing $7,000 to each wrapper, the real 2025 IRA limit, comes out $5,908 ahead in the Roth once the side account the traditional deduction creates is modelled and taxed along the way. The wash is real arithmetic; it just prices a contribution measured in pre-tax dollars, and the limit is not written that way.
Two omissions, and the second one is bigger
A Roth dollar is an after-tax dollar, so a $7,000 Roth contribution shelters the same economic exposure as $9,211 of pre-tax money. The traditional saver can only get $7,000 of that inside the wrapper; growth on the $2,211 left outside is worth $5,908 over 30 years, and that is the part of this comparison almost no calculator makes. Below the limit, stop agonising: the two are close to equivalent and the future rate is the only thing that separates them. At the limit, the tie-break is not close.
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