2024 IRS limits · client-side

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Roth vs Traditional IRA

Pay taxes now or later? Enter your current and expected retirement tax brackets — see after-tax balances, the break-even retirement rate, and a year-by-year growth schedule. Built for freelancers who control their income timing.

401(k) Limit 2024$23,000(+$7,500 catch-up 50+)

Roth IRA Limit$7,000(MAGI phase-out applies)

S&P 500 Avg Return~10%/yr(nominal, historical)

Your IRA Profile

Current age

yrs

Retirement age

yrs

Annual contribution2024 limit: $7,000

Expected annual return

Current marginal tax rateYour rate today — this is what Roth costs

Expected retirement tax rateLower if income drops; higher if SS + RMDs push you up

Current Roth balance

Current Traditional balance

Roth wins by $145K

Equal rates produce mathematically identical after-tax outcomes. Roth has a practical edge: no Required Minimum Distributions, tax-free inheritance for heirs, and no income tax on future growth. Default to Roth when rates are uncertain.

Roth at Retirement

$661K

$0 tax at withdrawal

Roth Net Value

$661K

Keep every dollar

Traditional at Retirement

$661K

$145K tax owed

Traditional Net Value

$516K

After 22.0% retirement tax

Head-to-Head Comparison

Roth IRA

Contribution / yr$7,000

Balance at retirement$661K

Tax at withdrawal$0

Net after-tax$661K

Traditional IRA

Contribution / yr$7,000

Balance at retirement$661K

Tax at withdrawal (22.0%)−$145K

Net after-tax$516K

Break-even retirement tax rate

At this rate, both accounts produce identical after-tax wealth

0.0%

Balance Over Time

Age	Roth	Traditional	Trad (after-tax)
35	$0	$0	$0
40	$43K	$43K	$34K
45	$103K	$103K	$81K
50	$188K	$188K	$147K
55	$307K	$307K	$240K
60	$474K	$474K	$370K
65	$708K	$708K	$552K

Annual contribution (capped at IRS limit)

min(annualContribution, limit)

min($7,000, $7,000)

= $7,000

2024 limit: $7,000 (catch-up available at 50)

Roth: future value at retirement

FV(pmt, r, n) + FV(currentBalance, r, n)

$7,000/yr × 30 yrs @ 7.0%

= $661K

Tax-free at withdrawal — $0 owed.

IRS Publication 590-A

Traditional: future value at retirement

FV(pmt, r, n) + FV(currentBalance, r, n)

$7,000/yr × 30 yrs @ 7.0%

= $661K

Traditional: tax owed at withdrawal

tradTotal × retirementTaxRate

$661K × 22.0%

= $145K

All withdrawals taxed as ordinary income.

Traditional: net after-tax value

tradTotal × (1 − retirementTaxRate)

$661K × (1 − 22.0%)

= $516K

Break-even retirement tax rate

(1 − rothTotal / tradTotal) × 100

(1 − $661K / $661K) × 100

= 0.0%

The retirement tax rate at which both accounts produce identical after-tax wealth.

Key insight

With the same nominal contribution amount, Roth wins when your retirement tax rate is higher than today's rate, Traditional wins when lower. When rates are equal, the after-tax outcome is identical — but Roth has practical advantages: no RMDs, tax-free inheritance, and no income tax risk on future growth.

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