Finance Tools
Roth 401(k) Calculator
Compare Roth 401(k) vs Traditional 401(k) outcomes using tax rates now vs in retirement, and estimate after-tax retirement value.
Roth 401(k) Calculator
Compare Roth 401(k) vs Traditional 401(k) using your tax rate now vs your expected tax rate in retirement. This tool estimates the after-tax value at retirement under simple assumptions.
Results
Account Value Before Retirement Taxes: $367,856
Roth 401(k) After-Tax Value (tax-free withdrawals): $367,856
Traditional 401(k) After-Tax Value (taxed at retirement): $294,285
Difference (Roth − Traditional): $73,571
Assumptions: return 6.0%, tax now 30.0%, tax in retirement 20.0%.
Roth 401(k) vs Traditional 401(k)
Roth 401(k) contributions are made with after-tax dollars, but qualified withdrawals are generally tax-free. Traditional 401(k) contributions are typically pre-tax, but withdrawals are taxed in retirement. A key factor is whether your tax rate will be higher or lower later.
FAQ
Does this include employer match?
No. Employer match rules can vary and are often treated as pre-tax in many plans. This calculator focuses on employee contributions and tax timing.
Is this a full tax model?
No. It’s a simplified comparison using two tax rates. Real outcomes may vary based on brackets, deductions, and withdrawal strategy.
How to use this roth 401(k) calculator
- Enter your annual contribution and years to invest.
- Enter expected annual return rate.
- Enter your tax rate now and your expected tax rate in retirement.
- Review after-tax retirement value for Roth vs Traditional.
- Compare which option could be higher under your assumptions.
Example
If you invest $10,000/year for 20 years at 6%, and tax rate is 30% now vs 20% in retirement, Traditional may come out ahead because withdrawals are taxed at a lower rate later.
- Roth: contribute after-tax now, withdrawals tax-free later
- Traditional: contribute pre-tax now, pay tax on withdrawals later
- Lower retirement tax rate can favor Traditional
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