The IRA Calculator compares the projected retirement value of a Traditional IRA, a Roth IRA, and a regular taxable account using the same contributions. Enter your details below and click Calculate to see which account leaves you with the most after-tax money.
The IRA calculator projects how much an Individual Retirement Account (IRA) could be worth at retirement and, just as importantly, compares the after-tax outcome of a Traditional IRA, a Roth IRA, and an ordinary taxable savings account funded with the same money. Because the three account types are taxed at very different points - going in, growing, or coming out - the one that leaves you with the most spendable money at retirement depends heavily on your tax rate today versus your expected tax rate in retirement. This calculator does that comparison for you, so you can make an informed choice about where to save.
Enter your current balance, annual contribution, expected rate of return, current and retirement ages, and your tax rates now and in retirement. The calculator returns each account's balance at retirement, the after-tax value, and a year-by-year growth chart.
An Individual Retirement Account (IRA) is a tax-advantaged investment account designed to help individuals save for retirement. Unlike a workplace 401(k), an IRA is opened and controlled by you through a bank, brokerage, or other financial institution, and it gives you a wide range of investment choices. The defining feature of an IRA is its favorable tax treatment, which can significantly boost the amount you accumulate over a long career compared with an ordinary taxable account.
The two main types - Traditional and Roth - differ in when you get the tax break. With a Traditional IRA, you typically deduct contributions now and pay tax later when you withdraw. With a Roth IRA, you pay tax on contributions now and withdraw completely tax-free in retirement. Choosing between them is one of the most consequential decisions in retirement planning.
A Traditional IRA is funded with pre-tax dollars - contributions may be tax-deductible in the year you make them, lowering your current taxable income. The money then grows tax-deferred, meaning you pay no tax on dividends, interest, or capital gains along the way. When you withdraw in retirement, the entire amount (contributions and growth) is taxed as ordinary income at your tax rate at that time.
In the calculator, the Traditional IRA invests the full contribution (since it is pre-tax), grows it at your expected rate of return, and then applies your retirement tax rate to the final balance to show the true after-tax value. A Traditional IRA tends to win when your tax rate in retirement is lower than your tax rate today - you deduct at a high rate now and pay tax at a lower rate later.
Traditional IRAs are subant to required minimum distributions (RMDs) beginning at age 73, which force you to start withdrawing (and paying tax) whether you need the money or not.
A Roth IRA is funded with after-tax dollars - you get no deduction today, so the effective amount invested is smaller. In exchange, the account grows completely tax-free, and qualified withdrawals in retirement are 100% tax-free. There are no required minimum distributions during the original owner's lifetime, making the Roth a powerful estate-planning and flexibility tool.
In the calculator, the Roth IRA reduces both the current balance and each contribution by your current marginal tax rate (the tax you pay before investing), then grows that smaller amount tax-free with no tax applied at the end. A Roth IRA tends to win when your tax rate in retirement is higher than today, or when you value tax-free income and the flexibility of no RMDs.
A regular taxable account has no special tax treatment. You contribute after-tax dollars, and you also owe tax on the account's growth as it occurs (on dividends, interest, and realized gains). This "tax drag" each year meaningfully slows compounding over decades. The calculator models this by reducing contributions for current taxes and applying tax to the annual return, producing an after-tax growth rate. A taxable account almost always trails both IRAs over a long horizon - which is precisely why the tax advantages of IRAs are so valuable.
All three accounts start from your current balance and add your annual contribution each year, compounding at your expected rate of return until retirement. The difference is purely in the taxes:
Example: Starting with $30,000, contributing $7,500 a year, earning 6% from age 30 to 65, with a 25% current tax rate and a 15% retirement tax rate, the Traditional IRA grows to $1,066,343 before tax - or $906,392 after tax. The same money in a Roth IRA yields $799,758 (all tax-free), and in a taxable account just $563,434. Here the Traditional IRA comes out ahead because the retirement tax rate (15%) is lower than the current rate (25%).
The core question is simple: will your tax rate be higher now or in retirement?
Many savers hedge by holding both, a strategy called "tax diversification," which gives flexibility to manage taxable income in retirement. Because future tax law and your own income are uncertain, splitting contributions can be a reasonable middle path.
The IRS sets annual contribution limits for IRAs, which are periodically adjusted for inflation. In recent years the limit has been $7,000 for those under 50, with an additional "catch-up" contribution for those 50 and older. These limits apply across all your IRAs combined, not per account. Note that the calculator lets you model any contribution amount so you can plan scenarios, but you should keep your actual contributions within the current legal limits.
Other important rules include:
Beyond Traditional and Roth, several IRA variations serve specific situations. The calculator's "Traditional, SIMPLE, or SEP" category reflects that these are all taxed similarly (pre-tax contributions, taxed at withdrawal):
Because IRA growth compounds over decades, the single most powerful factor in your final balance is time. Contributions made in your twenties have 40+ years to compound, so each early dollar can grow into many times its value by retirement. Delaying contributions even a few years can cost a surprising amount at the end. The calculator makes this vivid: adjust the current age up by five years and watch how much the ending balance falls. If you can only do one thing for your retirement, start contributing as early as possible.
A Traditional IRA uses pre-tax contributions that are taxed when withdrawn in retirement, while a Roth IRA uses after-tax contributions that grow and are withdrawn tax-free. Traditional gives you a tax break now; Roth gives you tax-free income later.
It depends on your tax rates. If your tax rate in retirement will be lower than it is now, a Traditional IRA usually wins. If your retirement tax rate will be higher (or you value tax-free withdrawals and no RMDs), a Roth IRA usually wins. This calculator computes both so you can compare directly.
A taxable account is funded with after-tax dollars and also owes tax on its growth every year. This annual "tax drag" reduces the effective rate of return and compounds against you over decades, so it almost always trails both IRA types.
The IRS sets annual limits that change over time, with an extra catch-up amount for those 50 and older. The limit applies across all your IRAs combined. Check the current year's limit, since the calculator itself lets you model any amount.
RMDs are mandatory withdrawals you must begin taking from a Traditional IRA at age 73, and they are taxed as income. Roth IRAs have no RMDs during the original owner's lifetime, which is one of their key advantages.
Yes. Many people contribute to both to achieve tax diversification, though your total contributions across all IRAs must stay within the annual limit. Holding both gives you flexibility to manage your taxable income in retirement.