Roth vs Traditional Calculator · filed Oct 10, 2026
Should I do Roth or Traditional 401(k)?
The enrollment form asks one question you cannot answer by feel: pay the tax now or later. For the 2026 deferral limit of $24,500, this page posts the worked example at a 24% rate today versus 18% in retirement — and shows the number that decides it.
Worked at $24,500 a year for 30 years at 7%, 24% now vs 18% in retirement: $141,740 tax-free in Roth against $152,930 spendable in Traditional — Traditional wins by $11,190.
The worked example — $24,500 a year, 30 years, 7%
The 401(k) version of the choice has one wrinkle the IRA version lacks: the employer match. Match dollars are nearly always pre-tax, even when your contributions are Roth, so most 401(k) participants already own some Traditional money whether they chose it or not. In the worked example, a 4% match adds $6,117 of after-tax spending power on top of whichever side you pick — it is a constant, not a tiebreaker.
The deciding number is the same as everywhere else: your marginal rate today versus your marginal rate in retirement. At 24% now and 18% later, Traditional banks the 24% deduction and pays 18% on the way out. The $11,190 gap is the reward for being in a lower bracket when you withdraw. If your retirement bracket rises above today’s — a pension, a working spouse, big RMDs — the stamp flips.
For 2026, the employee deferral limit is $24,500 if you are under 50. High earners who want more Roth than the limit allows should read the high-earner page: the backdoor Roth IRA is the overflow valve.
Run your own numbers in the calculator
Posted at the bottom of the sheet
- Should I do Roth or Traditional 401(k)?
- Compare your marginal tax rate today with the rate you expect in retirement. Worked example at the 2026 limit: $24,500 a year for 30 years at 7%, 24% now versus 18% in retirement, ends at $141,740 tax-free in Roth versus $152,930 spendable in Traditional -- a $11,190 edge for Traditional. A higher retirement rate flips the answer to Roth.
- Does the employer match change the Roth vs Traditional answer?
- No -- the match is nearly always pre-tax either way, so it adds the same Traditional-style dollars regardless of your choice. At 4% on $24,500 a year for 30 years at 7%, it is worth about $6,117 in after-tax spending power at an 18% retirement rate.
- What is the 2026 401(k) contribution limit?
- The 2026 employee deferral limit is $24,500 if you are under 50; catch-up contributions raise it further at 50 and up. The worked example on this page uses the full $24,500.
- Can I split between Roth and Traditional 401(k)?
- Yes, if your plan offers both -- many workers split to hedge an uncertain future rate. Splitting is diversification of tax risk, not a way to beat the math: each dollar still wins or loses on the same rate comparison.
Filed under retirement taxes
- Roth vs Traditional CalculatorPost your own numbers — contribution, rates, years — and get the verdict stamped.
- Roth vs Traditional: Marginal vs Effective RateThe rate mistake that decides the answer — and the one number you should actually use.
- Roth vs Traditional for High EarnersWhen your rate is already the top one: the backdoor and the break-even.
- Roth vs Traditional Early in Your CareerYoung, low-bracket, decades ahead: the case Roth was built for.
- Roth vs Traditional IRAThe IRA version at the 2026 contribution limit — no employer plan required.