Roth vs. Traditional 401(k)/IRA Calculator
Compare the after-tax value of Roth vs. Traditional 401(k) or IRA contributions from your federal brackets now and in retirement, plus what each state adds.
Putting $12,000 a year into a 401(k) from age 35 to 65 at 7% (single, $90,000 of taxable income now, then $20,000 a year withdrawn on top of $40,000 of other income), Traditional beats Roth by $58,944 after federal tax: the deferral avoids 22% today and the withdrawals pay 16.8%. State tax moves that gap. Illinois taxes the wages a Roth contribution uses at 4.95% ($594 a year a Traditional deferral avoids) and subtracts the withdrawals, so Traditional's lead grows to $115,053. Pennsylvania taxes 401(k) deferrals as wages either way and does not tax the withdrawals, so the lead stays $58,944. In South Carolina a Traditional deferral avoids $625 a year, and once the other income has used its age-65 deduction each withdrawal owes $881, so Traditional leads by $68,068. The table below the calculator gives the same three figures for all 50 states.
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Additional Details
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Better Choice for Your Numbers
Estimated • Based on your inputs
After-Tax Advantage
-$58,943.53
Traditional: After-Tax Value at Retirement
$943,096.49
Roth: After-Tax Value at Retirement (Tax-Free)
$884,152.96
Detailed Breakdown
Disclaimer: This calculator provides estimates for informational purposes only. Results should not be considered financial, tax, or legal advice. Consult a qualified professional for your specific situation.
How This Calculator Works
Calculation methodology and assumptions
This calculator sets aside the SAME dollar amount of gross income for retirement savings every year and compares what each account type delivers after tax. Traditional invests the full contribution pre-tax and pays ordinary income tax later; Roth pays the current federal tax attributable to that income first and invests the remainder tax-free. The current tax benefit is calculated as tax before the Traditional deduction minus tax after the deduction, with taxable income floored at zero. Retirement withdrawals are stacked on top of other retirement income to get a blended federal rate. Contributions are capped at the 2026 account limit and current-age catch-up rule. IRA mode assumes MAGI allows the full Roth contribution and the Traditional IRA contribution is fully deductible; it does not model the separate Roth eligibility or workplace-plan Traditional deduction phaseouts. State tax is priced separately, in the state table below the calculator, at the calculator's defaults; the calculator above compares federal tax only. The projection also excludes Additional Medicare Tax, Social Security interactions, RMDs, and changing contribution limits/ages over time.
How to Use This Investment & Retirement Calculator
- 1
Enter your initial investment
Input the lump sum you plan to invest today. This is your starting principal that will begin compounding immediately.
- 2
Set your monthly contribution
Enter the amount you plan to add each month. Consistent contributions accelerate growth through dollar-cost averaging.
- 3
Input expected return and time horizon
Set your expected annual return (7–10% for stocks historically, 4–6% for bonds) and investment period. Longer time horizons amplify compounding effects dramatically.
- 4
Review the growth projection
The results show your total invested amount, earnings from compound growth, and a year-by-year projection table showing how your money grows over time.
Example Calculation
How does compound interest build wealth over time?
Starting with $10,000 and adding $500/month at an 8% average annual return for 30 years: Your total contributions would be $190,000 ($10K initial + $180K in monthly deposits). But with compound growth, your portfolio would grow to approximately $745,000.
Result: Compound interest generated $555,000 in earnings on top of your $190,000 in contributions — nearly 75% of the final value came from returns, not deposits. Starting 5 years later would reduce the final amount by roughly $230,000. Time in the market is the most powerful factor in wealth building.
What Affects Your Results
Rate of Return
Even small differences compound massively over time. 7% vs. 8% over 30 years on $100K means a difference of $200K+. Asset allocation drives your expected return.
Time Horizon
Compounding accelerates exponentially. Most of your wealth is generated in the final years — a 30-year investment earns more in its last 5 years than its first 15.
Contribution Consistency
Regular monthly investments (dollar-cost averaging) smooth out market volatility and ensure you're always buying — including during dips when prices are low.
Fees & Expenses
A 1% annual fee vs. 0.1% fee on a $500K portfolio costs you $4,500/year extra. Over 30 years, high fees can consume 25–30% of potential returns. Use low-cost index funds.
Tips & Best Practices
- Start early. Thanks to compounding, $200/month invested from age 25 to 65 at 8% returns grows to ~$700K. Waiting until 35 cuts that to ~$300K — a $400K penalty for the 10-year delay.
- Don't try to time the market. Research consistently shows that time in the market beats timing the market. Missing the 10 best trading days over 20 years can halve your returns.
- Consider tax-advantaged accounts first: 401(k) (especially with employer match), IRA, HSA. These reduce your tax drag — a 25% tax bracket investor keeps more in a tax-deferred account.
- Rebalance annually. If stocks outperform and grow from 80% to 90% of your portfolio, rebalancing back to 80% locks in gains and manages risk.
- Factor in your state's tax treatment of investment income. Some states exempt certain investment income or have lower rates on capital gains.
Roth or Traditional 401(k) in each state
Each row runs the defaults above (federal result: Traditional by $58,944) through one state's tax. A Traditional deferral lowers this year's state taxable wages, so going Roth costs that state tax now; a Traditional withdrawal is state income later, while a qualified Roth withdrawal is not. Where the two state rates match, the state cancels out and the federal answer stands; where the deferral saves more than the withdrawal costs, Traditional pulls further ahead, and where the withdrawal costs more, Roth gains ground.
Illinois, Pennsylvania, South Carolina, New Jersey, Iowa and Georgia are priced with their own retirement exclusions, read from each state's statute or return instructions, from age 65. Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming have no wage income tax. For the other 35 states the withdrawal column is the most the state's brackets can take and the last column is the answer before any exclusion, because this site has not read their retirement rules or, for Virginia and Connecticut, because the exclusion is income-tested on federal adjusted gross income, which this calculator does not ask for. Every dollar your state return excludes can only widen Traditional's lead.
| State | Saved now by going Traditional (per year) | State tax on each $20,000 withdrawal | Better after federal and state tax |
|---|---|---|---|
| Alabama | $600 (5%) | Up to $1,000, less your exclusion | Traditional by $58,944, before any exclusion |
| Alaska | $0 (no wage income tax) | $0 | Traditional by $58,944 |
| Arizona | $300 (2.5%) | Up to $500, less your exclusion | Traditional by $58,944, before any exclusion |
| Arkansas | $444 (3.7%) | Up to $740, less your exclusion | Traditional by $58,944, before any exclusion |
| California | $1,116 (9.3%) | Up to $1,220, less your exclusion | Traditional by $95,210, before any exclusion |
| Colorado | $528 (4.4%) | Up to $880, less your exclusion | Traditional by $58,944, before any exclusion |
| Connecticut | $660 (5.5%) | Up to $1,000, less your exclusion | Traditional by $64,611, before any exclusion |
| Delaware | $792 (6.6%) | Up to $1,110, less your exclusion | Traditional by $70,846, before any exclusion |
| Florida | $0 (no wage income tax) | $0 | Traditional by $58,944 |
| Georgia | $599 (4.99%) | $0 (excluded) | Traditional by $115,507 |
| Hawaii | $912 (7.6%) | Up to $1,488, less your exclusion | Traditional by $60,757, before any exclusion |
| Idaho | $636 (5.3%) | Up to $1,060, less your exclusion | Traditional by $58,944, before any exclusion |
| Illinois | $594 (4.95%) | $0 (excluded) | Traditional by $115,053 |
| Indiana | $354 (2.95%) | Up to $590, less your exclusion | Traditional by $58,944, before any exclusion |
| Iowa | $456 (3.8%) | $0 (excluded) | Traditional by $102,018 |
| Kansas | $670 (5.58%) | Up to $1,116, less your exclusion | Traditional by $58,944, before any exclusion |
| Kentucky | $420 (3.5%) | Up to $700, less your exclusion | Traditional by $58,944, before any exclusion |
| Louisiana | $360 (3%) | Up to $600, less your exclusion | Traditional by $58,944, before any exclusion |
| Maine | $858 (7.15%) | Up to $1,350, less your exclusion | Traditional by $63,478, before any exclusion |
| Maryland | $570 (4.75%) | Up to $950, less your exclusion | Traditional by $58,944, before any exclusion |
| Massachusetts | $600 (5%) | Up to $1,000, less your exclusion | Traditional by $58,944, before any exclusion |
| Michigan | $510 (4.25%) | Up to $850, less your exclusion | Traditional by $58,944, before any exclusion |
| Minnesota | $816 (6.8%) | Up to $1,360, less your exclusion | Traditional by $58,944, before any exclusion |
| Mississippi | $480 (4%) | Up to $800, less your exclusion | Traditional by $58,944, before any exclusion |
| Missouri | $564 (4.7%) | Up to $940, less your exclusion | Traditional by $58,944, before any exclusion |
| Montana | $678 (5.65%) | Up to $1,130, less your exclusion | Traditional by $58,944, before any exclusion |
| Nebraska | $546 (4.55%) | Up to $910, less your exclusion | Traditional by $58,944, before any exclusion |
| Nevada | $0 (no wage income tax) | $0 | Traditional by $58,944 |
| New Hampshire | $0 (no wage income tax) | $0 | Traditional by $58,944 |
| New Jersey | $764 (6.37%) | $0 (excluded) | Traditional by $131,149 |
| New Mexico | $588 (4.9%) | Up to $980, less your exclusion | Traditional by $58,944, before any exclusion |
| New York | $695 (5.79%) | Up to $1,080, less your exclusion | Traditional by $63,360, before any exclusion |
| North Carolina | $479 (3.99%) | Up to $798, less your exclusion | Traditional by $58,944, before any exclusion |
| North Dakota | $234 (1.95%) | Up to $225, less your exclusion | Traditional by $68,310, before any exclusion |
| Ohio | $330 (2.75%) | Up to $550, less your exclusion | Traditional by $58,944, before any exclusion |
| Oklahoma | $540 (4.5%) | Up to $900, less your exclusion | Traditional by $58,944, before any exclusion |
| Oregon | $1,050 (8.75%) | Up to $1,750, less your exclusion | Traditional by $58,944, before any exclusion |
| Pennsylvania | $0 (deferral taxed as wages) | $0 (excluded) | Traditional by $58,944 |
| Rhode Island | $570 (4.75%) | Up to $750, less your exclusion | Traditional by $70,279, before any exclusion |
| South Carolina | $625 (5.21%) | $881 after its exclusion | Traditional by $68,068 |
| South Dakota | $0 (no wage income tax) | $0 | Traditional by $58,944 |
| Tennessee | $0 (no wage income tax) | $0 | Traditional by $58,944 |
| Texas | $0 (no wage income tax) | $0 | Traditional by $58,944 |
| Utah | $534 (4.45%) | Up to $890, less your exclusion | Traditional by $58,944, before any exclusion |
| Vermont | $792 (6.6%) | Up to $1,015, less your exclusion | Traditional by $76,258, before any exclusion |
| Virginia | $690 (5.75%) | Up to $1,150, less your exclusion | Traditional by $58,944, before any exclusion |
| Washington | $0 (no wage income tax) | $0 | Traditional by $58,944 |
| West Virginia | $550 (4.58%) | Up to $844, less your exclusion | Traditional by $63,024, before any exclusion |
| Wisconsin | $636 (5.3%) | Up to $966, less your exclusion | Traditional by $64,289, before any exclusion |
| Wyoming | $0 (no wage income tax) | $0 | Traditional by $58,944 |
Today's column is the state's 2026 single-filer brackets or flat rate on the $12,000 slice of the taxable income above, with no state deduction; Pennsylvania taxes 401(k) deferrals as wages (its revenue department's guide, read 2026-10-09), so going Traditional saves nothing there. The withdrawal column stacks each year's withdrawal on the other retirement income, treated as income the state taxes. A Roth 401(k) is assumed to pay out qualified, untaxed by the state as it is federally, and the federal deduction for state tax paid is ignored.
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StateCalc Team
Editorial Team
The StateCalc team builds free financial calculators using data from official government sources including the IRS, U.S. Census Bureau, BLS, and state revenue departments. All formulas are validated by an automated test suite and cross-referenced against published data.
Our editorial standardsFrequently Asked Questions
Roth or Traditional -- which is actually better?
It depends entirely on whether your marginal tax rate today is higher or lower than your effective tax rate will be in retirement. If your rate today is higher, Traditional generally wins (you get the deduction while your rate is high, and pay tax later at a lower rate). If your rate in retirement will be higher, Roth generally wins. If the two rates are equal, the after-tax result is mathematically identical -- use the calculator above with your own numbers rather than a rule of thumb.
Why does the calculator show a smaller dollar amount actually invested in the Roth account?
Because Roth contributions are made with after-tax dollars. If you set aside the same pre-tax income for both accounts, the Traditional account invests every dollar of it, while the Roth account first pays income tax on that income (at your current marginal rate) and only invests what is left. That "haircut" happens up front for Roth and at withdrawal for Traditional -- which is exactly why comparing the two options requires comparing tax rates at both points in time, not just contribution amounts.
Is it true that Roth and Traditional are the same if tax rates don’t change?
Yes -- this is a well-known result in retirement-planning math, and this calculator will show it directly: if your marginal tax rate on the contribution today exactly equals your effective tax rate on the withdrawal in retirement, the after-tax value of a Roth account and a Traditional account come out identical, because the same percentage of the original pre-tax dollars is lost to taxes either way -- just at different times.
What is the 2026 contribution limit for each account type?
For 2026, the 401(k) elective-deferral limit is $24,500 ($32,500 with the age-50 catch-up, or $35,750 with the SECURE 2.0 age 60-63 "super catch-up"). The IRA limit is $7,500 ($8,600 if 50+) -- and this limit is shared between Roth and Traditional IRA contributions combined, it is not doubled by splitting between the two.
Does this calculator account for state income tax?
For a 401(k), yes. The state table below the calculator does, at the calculator's defaults; the calculator itself still compares federal tax only. Today's side is the state tax a Traditional deferral saves: the state's 2026 brackets or flat rate on the slice of income the deferral removes (Pennsylvania taxes 401(k) deferrals, so nothing is saved there). The retirement side is the state tax on each withdrawal: Illinois, Pennsylvania, South Carolina, New Jersey, Iowa and Georgia are run through their own retirement exclusions from age 65; the nine states without a wage income tax charge nothing; for every other state the table shows the most the state's brackets can take, before any exclusion your state allows. IRA mode stays federal-only, because states split on whether a Traditional IRA contribution is deductible: New Jersey, for example, taxes IRA contributions in the year they are made (New Jersey Division of Taxation, GIT-2 IRA Withdrawals).
Does IRA mode check whether I can deduct a Traditional IRA contribution or contribute to a Roth IRA?
No. IRA mode assumes you qualify for the full Roth contribution and the full Traditional IRA deduction. In reality, Roth eligibility and Traditional IRA deductibility phase out at different MAGI levels, and the Traditional rules also depend on whether you or your spouse participate in a workplace retirement plan. Confirm eligibility separately before relying on the IRA comparison.
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