401(k) Growth Calculator
Free 401(k) growth calculator. Project your 401(k) balance over time with employer match, annual contribution increases, and compound growth to see the power of tax-deferred retirement savings.
Roth 401(k) vs Traditional 401(k) Calculator
Free Roth vs Traditional 401(k) calculator. Compare after-tax retirement wealth by contributing pre-tax (Traditional) or after-tax (Roth) based on your current and future tax rates.
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For invested tax savings
%
Winner
Traditional 401(k)
by $280,574.00 in after-tax wealth
Traditional 401(k)
Pre-tax balance: $1,353,529.00
After withdrawal tax: $1,055,753.00
+ Tax savings invested: $253,503.00
Total: $1,309,256.00
Roth 401(k)
Tax-free balance: $1,028,682.00
No withdrawal tax owed
All growth is tax-free
Total: $1,028,682.00
Break-Even Tax Rate⧉
24.0%
Retirement rate where both are equal
After-Tax Difference⧉
$280,574.00
Traditional advantage
After-Tax Wealth Over Time
| Year | Traditional (Total) | Roth | Difference |
|---|---|---|---|
| 1 | $21,735.00 | $16,264.00 | +$5,471.00 |
| 2 | $44,895.00 | $33,666.00 | +$11,229.00 |
| 5 | $123,935.00 | $93,530.00 | +$30,405.00 |
| 10 | $294,668.00 | $224,711.00 | +$69,957.00 |
| 15 | $530,488.00 | $408,698.00 | +$121,790.00 |
| 20 | $856,860.00 | $666,751.00 | +$190,109.00 |
| 25 | $1,309,256.00 | $1,028,682.00 | +$280,574.00 |
Traditional total includes investing the upfront tax savings in a taxable account. Assumes constant tax rates and returns. Actual results depend on tax law changes, investment performance, and personal circumstances. Consult a financial advisor.
Planning notes, formulas, and examples
About the Roth 401(k) vs Traditional 401(k) Calculator
The Roth 401(k) vs Traditional 401(k) Calculator compares the after-tax retirement wealth produced by each option. The fundamental difference: Traditional contributions are pre-tax (reducing your taxable income now, taxed at withdrawal) while Roth contributions are after-tax (no deduction now, but tax-free withdrawals in retirement).
The key variable is whether your tax rate will be higher or lower in retirement. If you expect higher taxes later, Roth wins. If lower, Traditional wins. In practice, the optimal choice depends on your current marginal rate, expected retirement rate, investment horizon, and whether you can invest the Traditional tax savings.
Enter your income, contribution amount, tax rates, and time horizon to see which option produces more after-tax wealth at retirement. The decision depends heavily on your current tax bracket, expected retirement income, state tax rules, and how long you plan to let the account grow. Running both scenarios side by side eliminates guesswork and reveals the optimal strategy.
When This Page Helps
Choosing between Roth and Traditional 401(k) is one of the most impactful retirement decisions. This calculator quantifies the after-tax difference so you can make a data-driven choice rather than guessing. Even a small tax rate difference compounded over 25+ years can mean tens of thousands of dollars. This clarity is especially valuable during open enrollment when you need to commit to a contribution strategy.
How to Use the Inputs
- Enter your annual 401(k) contribution amount.
- Enter your current marginal tax rate.
- Enter your expected tax rate in retirement.
- Set your expected annual investment return.
- Enter the years until retirement.
- Compare the after-tax retirement wealth under each option.
Formula used
Traditional: After-Tax = Contribution × (1 + return)^years × (1 − retirement tax rate)
Roth: After-Tax = Contribution × (1 − current tax rate) × (1 + return)^years
With Tax Savings Invested: Traditional + (Contribution × current tax rate) × (1 + return × (1 − cap gains rate))^years × (1 − cap gains rate)Example Calculation
Result: Traditional after-tax: $84,497 | Roth after-tax: $82,573
Contributing $20,000/year for 25 years at 7% grows to $1,353,181. Traditional: taxed at 22% withdrawal = $1,055,481 after-tax. Roth: $20,000 minus 24% tax = $15,200 effective contribution, growing tax-free to $825,734. But if Traditional tax savings ($4,800/year) are invested in a taxable account, total Traditional after-tax wealth is approximately $1,084,497, making Traditional slightly better when the retirement rate is lower.
Tips & Best Practices
- If your current and retirement tax rates are equal, Roth and Traditional produce identical after-tax results mathematically.
- Early career (lower income) often favors Roth; peak earnings years often favor Traditional.
- Consider splitting contributions between Roth and Traditional for tax diversification.
- Roth 401(k) has no income limit, unlike Roth IRA — high earners can contribute.
- Traditional 401(k) saves more on taxes now, which matters for immediate cash flow.
- Tax rates could increase in the future due to national debt — a common argument for Roth.
The Tax Rate Crossover
The decision between Roth and Traditional hinges on one question: will your marginal tax rate be higher or lower in retirement? If you're currently in the 22% bracket and expect to withdraw in the 12% bracket, Traditional saves you 10 percentage points on every dollar. Conversely, if you're in the 12% bracket now but expect 22% in retirement, Roth saves you 10 points.
Tax Diversification Strategy
Many financial planners recommend a split approach: contribute to Traditional in high-income years and Roth in lower-income years. Having both buckets in retirement gives you flexibility to manage taxable income — withdraw from Traditional up to a tax bracket threshold, then take additional needs from Roth tax-free to avoid jumping brackets.
The Roth Advantage Beyond Taxes
Roth 401(k) has advantages beyond the tax rate comparison. Roth balances don't count as taxable income in retirement, which can reduce Medicare premiums (IRMAA), Social Security taxation, and overall tax bracket exposure. These indirect benefits are harder to quantify but can be substantial for retirees with large Traditional balances.
Sources & Methodology
Last updated:
Methodology
This worksheet compares the after-tax value of Traditional and Roth 401(k) contributions using the entered current and retirement tax rates, return assumptions, and time horizon. It is a planning model, not personalized tax advice.
Sources
- Retirement topics - 401(k) and profit-sharing plan contribution limits (IRS) — Official 2026 401(k) elective-deferral and annual-additions limit context.
- Retirement topics - Contributions (IRS) — Official retirement-plan contribution overview and aggregation rules.
- Retirement plans FAQs on designated Roth contributions (IRS) — Official Roth 401(k) treatment and designated Roth contribution context.
Frequently Asked Questions
Roth is better when your retirement tax rate will be higher than your current rate. This is common for young professionals early in their career, people who expect significant income growth, or those who believe tax rates will increase broadly. Roth also provides tax-free withdrawals, offering more flexibility in retirement.
Traditional is better when your current tax rate is higher than your expected retirement rate. This is typical for peak earners in mid-to-late career, those planning to retire in a low or no income tax state, or those who need the immediate tax deduction. The tax savings can be invested or used for other financial goals.
If you invest the tax savings from Traditional contributions in a taxable brokerage account, Traditional often wins even when rates are equal, because you're investing more total dollars. However, the taxable account incurs capital gains taxes, reducing this advantage. This calculator includes a "tax savings invested" scenario.
Yes! Most employers that offer Roth 401(k) allow you to split contributions between Roth and Traditional. The combined total cannot exceed the annual employee limit ($24,500 in 2026). Many financial advisors recommend contributing some to each for tax diversification.
Employer matching contributions always go into the Traditional (pre-tax) account, even if your own contributions are Roth. This means you'll always have some Traditional 401(k) balance regardless of your election. Starting in 2024, SECURE 2.0 allows employers to offer Roth matching contributions.
Yes, qualified Roth 401(k) distributions are completely tax-free — both contributions and earnings. To qualify, you must be 59½ or older and the account must have been open for at least 5 years. Non-qualified early withdrawals have earnings taxed as income plus a 10% penalty.
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