Roth vs traditional calculator
Compared on after-tax spending power, not on ending balance, because a traditional balance is partly owed to the IRS and a Roth balance is not.
2026 limits: $7,500 IRA, $24,500 401(k)
Nothing owed at withdrawal
$44,532 after tax, plus $10,924 from the invested saving
At the same tax rate now and later, the two are mathematically identical before the tax saving is counted. The whole question is which rate you expect to be higher.
A traditional contribution of $7,500 cuts your tax bill by about $1,650 today. Comparing the two without doing something with that money flatters Roth. Invested for 30 years it becomes about $10,924 after tax, which is what makes this a fair fight.
Projection only. Assumes one flat rate in retirement, when withdrawals actually fill brackets from the bottom, so the true blended rate is usually lower than your marginal rate today. Excludes required minimum distributions, state tax, the Roth IRA income phase-out ($153,000 to $168,000 for single filers in 2026), and any employer match, which is always traditional regardless of which you choose.
If your tax rate is the same now and in retirement, the two are mathematically identical. The entire question is which rate you expect to be higher. Roth wins if you expect to pay more later; traditional wins if you expect to pay less. The tie-breaker most comparisons ignore is whether you actually invest the tax saving a traditional contribution frees up today.
Frequently asked questions
Roth or traditional, which is better?
It depends entirely on your tax rate now versus in retirement, and at equal rates the two are mathematically identical. Early-career and in a low bracket, Roth usually wins because you pay tax at today's low rate and never again. In a high bracket now and expecting less in retirement, traditional usually wins.
Why does the ending balance not tell me the answer?
Because a traditional balance is not all yours. A $1,000,000 traditional account with a 22% rate in retirement is worth $780,000 of spending, while a $1,000,000 Roth is worth $1,000,000. Comparing balances rather than after-tax spending power systematically flatters traditional.
What is the tax saving everyone forgets?
A traditional contribution reduces your tax bill this year. If you invest that saving, traditional and Roth come out identical at equal rates. If you spend it, which is what most people do, Roth effectively lets you shelter more money. That is why this calculator asks.
Can I contribute to both?
Yes, and splitting is a reasonable hedge when you genuinely do not know your future rate. The combined limit applies across both, so it is $24,500 total across a Roth and traditional 401(k) in 2026, not $24,500 each. Note that an employer match is always traditional, regardless of which you choose for your own contributions.
Is there an income limit on a Roth?
On a Roth IRA, yes. For 2026 the ability to contribute phases out between $153,000 and $168,000 for single filers and between $242,000 and $252,000 for joint filers. A Roth 401(k) has no income limit at all, which is why high earners often use one.
Researching and writing about Canadian personal finance since 2026.
Last reviewed August 2026 · How we research
“Roth vs Traditional Calculator.” VaultNerd, https://www.vaultnerd.com/tools/roth-vs-traditional-calculator, updated August 2026.
- IRS Notice 2025-67: 2026 retirement plan contribution limits
- IRS: 401(k) limit increases to $24,500 for 2026, IRA limit increases to $7,500
- IRS Revenue Procedure 2025-32: 2026 tax brackets