IRA Calculator
IRA Calculator — Traditional vs. Roth vs. Taxable
Project your retirement balance and compare it across account types and tax treatments
| At Retirement | Traditional, SIMPLE, or SEP | Roth IRA | Regular Taxable |
|---|---|---|---|
| Balance (pre-tax) | $10,66,343 | $7,99,758 | $5,63,434 |
| Balance (after tax) | $9,06,392 | $7,99,758 | $5,63,434 |
| Age | Contributions (Cumulative) | Traditional Balance | Roth Balance | Taxable Balance |
|---|
Instant Comparison
See how Traditional, Roth, and taxable accounts stack up side by side as you adjust your inputs.
Tax-Adjusted Results
Traditional balances are shown both before and after applying your expected retirement tax rate.
Year-wise Schedule
Expand the growth table to see how contributions and compounding build your balance year by year.
Understanding IRAs
What is an IRA and How Does It Work?
A complete guide to Individual Retirement Accounts in the United States
An Individual Retirement Account (IRA) is a type of retirement savings plan with tax advantages defined by IRS Publication 590. It exists as a government incentive to encourage people to set money aside for retirement, and it can accumulate significantly more wealth over time than a regular taxable account because of the tax shields involved.
The two most widely used types are the Traditional IRA and the Roth IRA. Contributions to a Traditional IRA are typically tax-deductible, but withdrawals in retirement are taxed as ordinary income. A Roth IRA works the opposite way — contributions are made with after-tax money, but qualified withdrawals in retirement are completely tax-free. Because most people earn less in retirement than during their working years, their marginal tax rate is often lower later in life, which can make a Traditional IRA more advantageous for many savers. SEP IRAs and SIMPLE IRAs are additional account types designed for self-employed individuals and small businesses.
The calculator projects your balance using standard compound growth, then applies the relevant tax treatment:
For a Traditional, SIMPLE, or SEP IRA, the pre-tax future value is reduced by your expected retirement tax rate to arrive at the after-tax balance, since withdrawals are taxed as ordinary income. For a Roth IRA, no further tax is applied since qualified withdrawals are tax-free, but contributions are assumed to come from money that has already been taxed. For a regular taxable account, growth is assumed to be taxed annually at your expected rate, which generally results in slower compounding than either IRA type.
Contributions are usually tax-deductible, and the account grows tax-deferred until withdrawal. Withdrawals before age 59½ are penalized except in qualified cases, and required minimum distributions (RMDs) begin at age 73.
Funded with after-tax dollars, so investment growth and qualified withdrawals after age 59½ are tax-free. There are no required distributions during the owner's lifetime, allowing tax-free growth indefinitely.
SEP IRAs let employers contribute on behalf of employees with much higher limits than Traditional or Roth IRAs. SIMPLE IRAs are designed for small businesses with 100 or fewer employees and include mandatory employer matching.
The more you contribute each year, the larger your final balance — and starting early lets compounding work over a longer horizon, which matters more than the size of any single contribution.
Even a 1–2% difference in average annual return can change your final balance dramatically over a 20–30 year horizon, due to the compounding effect.
The number of years between now and retirement is one of the strongest drivers of the final balance. Delaying contributions by even a few years can meaningfully reduce the total accumulated.
The relative size of your current marginal tax rate versus your expected retirement tax rate determines whether a Traditional or Roth IRA leaves you with more after-tax money.