This IRA calculator projects how an Individual Retirement Account grows from annual contributions — and settles the classic question by showing Traditional and Roth side by side after tax, which is the only fair comparison.

Balance at End (pre-tax)–
Traditional IRA — after tax at withdrawal–
Roth IRA — spendable (tax-free)–
Total Contributions–

Traditional vs. Roth IRA — the One Idea That Decides It

Both accounts shelter growth from yearly taxes. The difference is when you pay:

  • Traditional: contributions are pre-tax (often deductible now); withdrawals in retirement are taxed as income.
  • Roth: contributions are after-tax (no deduction now); qualified withdrawals — including decades of growth — are completely tax-free.

So the winner depends on one comparison: your tax rate now vs. your tax rate in retirement. Higher now → Traditional tends to win. Higher later (early career, expected income growth) → Roth tends to win. Equal → mathematically a tie on the same pre-tax dollars. This calculator is part of our Finance Calculators collection.

Worked Example (Verified)

Contribute $7,000 a year for 30 years at 7% (starting from $0):

  • Final balance: $661,226 on $210,000 of contributions — growth adds $451,226
  • As a Roth: all $661,226 is spendable tax-free
  • As a Traditional with a 22% retirement tax rate: $661,226 × 0.78 = $515,756 spendable — but you also saved 22% tax on each contribution along the way, which is the Traditional side’s counterweight

IRA Facts That Matter (2025)

  • Contribution limit: $7,000/year under 50; $8,000 at 50+ (catch-up). You need earned income to contribute.
  • Roth income limits phase out eligibility at higher incomes; Traditional deductibility depends on workplace-plan coverage and income.
  • Roth flexibility: your contributions (not earnings) can be withdrawn any time without tax or penalty — a feature no Traditional account matches.
  • RMDs: Traditional IRAs force required minimum distributions in your 70s; Roth IRAs do not (for the original owner).
  • An IRA complements rather than replaces a workplace plan — compare with the 401k Calculator, especially capturing any employer match first.

For the full picture of retirement income and drawdown, see the Retirement Calculator; the growth engine in both is the Compound Interest Calculator.

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Frequently Asked Questions

What is the IRA contribution limit for 2025?

$7,000 if you are under 50, $8,000 if 50 or older, across all your IRAs combined — and you cannot contribute more than your earned income.

Which is better, Traditional or Roth?

Whichever tax rate is lower wins: deduct now at a high rate (Traditional) or pay now at a low rate (Roth). Early-career savers often favor Roth; peak earners often favor Traditional. Many people hold both for tax diversification.

Can I have both a 401(k) and an IRA?

Yes — they are separate accounts with separate limits. A common order is: 401(k) up to the full employer match, then an IRA, then back to the 401(k).

When can I withdraw from an IRA?

Generally 59½ for penalty-free access (Roth has a separate 5-year rule for earnings). Earlier withdrawals usually face income tax plus a 10% penalty, with exceptions.

Does this calculator model the Traditional deduction fairly?

It shows the Traditional balance after withdrawal tax and explains the up-front deduction’s role in the note under your results. A full comparison also reinvests the yearly tax savings — if you spend the deduction instead, the Roth pulls ahead at equal rates.

Is this IRA calculator free?

Yes — free, instant, no sign-up. It provides projections, not individualized financial advice.