# IRA Calculator – Traditional vs Roth

URL: https://speedycalculator.com/calculators/finance/ira/
Last updated: 2026-10-25

> The IRA calculator compares a traditional IRA with a Roth IRA – the balance at retirement, the yearly withdrawal and its after-tax value – based on your contributions, return and tax rates now and in retirement, using the 2026 limit of $7,500 ($8,600 at 50+).

## Inputs

- Current age
- Retirement age
- Years of withdrawals
- Current IRA balance
- Annual contribution
- Expected annual return (%)
- Current tax rate (%)
- Tax rate in retirement (%)

## Results

- Years to retirement
- 2026 contribution limit
- Contribution used (capped)
- Traditional IRA balance at retirement
- Traditional – yearly withdrawal after tax
- Roth IRA balance (same pre-tax cost)
- Roth – yearly withdrawal (tax-free)
- Better choice

## Formula

```
Balance = current balance × (1 + r)^n + contribution × ((1 + r)^n − 1) ÷ r
Traditional: contributions are deductible now; withdrawals taxed at the retirement rate
Roth: same pre-tax cost buys contribution × (1 − current rate); withdrawals tax-free
Yearly withdrawal = pmt(r, years in retirement, balance)
```

## Explanation

If your tax rate in retirement will be lower than today, a traditional IRA usually wins; if higher, a Roth. With equal rates they come out the same. Roth IRAs also have no required minimum distributions.

### How to use the IRA Calculator – Traditional vs Roth

- **Current age**
- **Retirement age**
- **Years of withdrawals**
- **Current IRA balance**
- **Annual contribution**
- **Expected annual return**
- **Current tax rate**
- **Tax rate in retirement**

Results update as you type, and every field accepts the units shown in its menu.

### How it works

Enter your age, retirement age, years of withdrawals, current balance, yearly contribution, expected return and tax rates now and in retirement.

### Tips

- Start early – time does more of the work than the amount you save.
- Take the full employer match if your plan offers one.
- Plan with a cautious return (4–6% after inflation) and check again every year.
- Know the contribution limits and required minimum distribution rules for your accounts.

### Common mistakes to avoid

- Ignoring inflation when setting a retirement target.
- Underestimating how long retirement can last.
- Withdrawing early and paying penalties and taxes.

### Inputs explained

FieldWhat to enterCurrent ageA numberRetirement ageA numberYears of withdrawalsA numberCurrent IRA balanceAmount in your currencyAnnual contributionAmount in your currencyExpected annual returnIn %Current tax rateIn %Tax rate in retirementIn %

### What each result means

- **Years to retirement** = max([Retirement age] - [Current age], 0)
- **Contribution used (capped)** = min([Annual contribution], [2026 contribution limit])
- **Traditional IRA balance at retirement** = fvc([Expected annual return]÷100, [Years to retirement], [Current IRA balance], [Contribution used (capped)])
- **Traditional – yearly withdrawal after tax** = pmt([Expected annual return]÷100, [Years of withdrawals], [Traditional IRA balance at retirement])×(1 - [Tax rate in retirement]÷100)
- **Roth IRA balance (same pre-tax cost)** = fvc([Expected annual return]÷100, [Years to retirement], [Current IRA balance], [Contribution used (capped)]×(1 - [Current tax rate]÷100))
- **Roth – yearly withdrawal (tax-free)** = pmt([Expected annual return]÷100, [Years of withdrawals], [Roth IRA balance (same pre-tax cost)])

## Worked example

Inputs — Current age: 30; Retirement age: 65; Years of withdrawals: 25; Current IRA balance: $10,000; Annual contribution: $7,500; Expected annual return: 7 %; Current tax rate: 22 %; Tax rate in retirement: 15 %.

Results — Years to retirement = 35; 2026 contribution limit = $7,500.00; Contribution used (capped) = $7,500.00; Traditional IRA balance at retirement = $1,143,542.40; Traditional – yearly withdrawal after tax = $83,408.77; Roth IRA balance (same pre-tax cost) = $915,451.55; Roth – yearly withdrawal (tax-free) = $78,555.37; **Better choice = Traditional IRA**.

## FAQ

**What is the IRA contribution limit for 2026?**
$7,500, or $8,600 if you're 50 or older.

**Traditional or Roth IRA?**
Traditional if you expect a lower tax rate in retirement; Roth if higher.

**Can I have both?**
Yes, but the limit applies to your combined contributions.

**What formula does the IRA Calculator – Traditional vs Roth use?**
Balance = current balance × (1 + r)^n + contribution × ((1 + r)^n − 1) ÷ r.


## Sources

- [IRS – IRA contribution limits](https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits)