Roth (after-tax) Account or Pre-Tax Account?
Age and retirement plan information: |
Investment return and taxes: |
After-Tax Total At Retirement |
After-Tax Comparison |
Your current age.
The amount you will contribute to your plan's account each year. This calculator assumes that you make 12 equal contributions throughout the year at the beginning of each month. The annual maximum for 2025 is $23,500. If you are age 50 or over, a 'catch-up' provision allows you to contribute an additional $7,500 into your account. Beginning in 2025 the SECURE 2.0 Act increases the catch-up contribution for individuals age 60 to 63. For 2025, this is $11,250 instead of $7,500. Beginning in 2026 catch-up contributions must be made as Roth contributions for individuals making more than $145,000 (adjusted for inflation) in the previous year. The current calculator does not incorporate the impact of the Roth requirement which is subject to pending IRS rule finalization and clarification. It is also important to note that employer contributions do not affect an employee's maximum elective deferral contribution limit.
Some employees are subject to additional contribution limits. If you expect your salary to be $160,000 or more in 2025 or was $155,000 or more in 2024, you may need to contact your employer to see if these additional contribution limits apply to you.
The annual rate of return for your account. This calculator assumes that your return is compounded annually and your deposits are made monthly. The actual rate of return is largely dependent on the types of investments you select. The Standard & Poor's 500® (S&P 500®) for the 10 years ending December 31st 2024, had an annual compounded rate of return of 14.9%, including reinvestment of dividends. From January 1, 1970 to December 31st 2024, the average annual compounded rate of return for the S&P 500®, including reinvestment of dividends, was approximately 11.2% (source: www.spglobal.com). Since 1970, the highest 12-month return was 61% (June 1982 through June 1983). The lowest 12-month return was -43% (March 2008 to March 2009). Savings accounts at a financial institution pay less but carry significantly lower risk of loss of principal balances.
It is important to remember that these scenarios are hypothetical and that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are generally subject to higher risk and volatility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment. It is not possible to invest directly in an index and the compounded rate of return noted above does not reflect sales charges and other fees that investment funds and/or investment companies may charge.
Age you wish to retire. This calculator assumes that the year you retire, you do not make any contributions to your account. For example, if you retire at age 65, your last contribution occurs when you are actually 64.
The current marginal income tax rate you expect to pay on your taxable investments. Use the table below to assist you in determining your current tax rate. Use the ‘Filing Status and Federal Income Tax Rates on Taxable Income’ table to assist you in estimating your federal tax rate.
| Tax Rate | Married Filing Jointly or Qualified Widow(er) | Single | Head of Household | Married Filing Separately |
|---|---|---|---|---|
| 10% | $0 - $23,850 | $0 - $11,925 | $0 - $17,000 | $0 - $11,925 |
| 12% | $23,850 - $96,950 | $11,925 - $48,475 | $17,000 - $64,850 | $11,925 - $48,475 |
| 22% | $96,950 - $206,700 | $48,475 - $103,350 | $64,850 - $103,350 | $48,475 - $103,350 |
| 24% | $206,700 - $394,600 | $103,350 - $197,300 | $103,350 - $197,300 | $103,350 - $197,300 |
| 32% | $394,600 - $501,050 | $197,300 - $250,525 | $197,300 - $250,500 | $197,300 - $250,525 |
| 35% | $501,050 - $751,600 | $250,525 - $626,350 | $250,500 - $626,350 | $250,525 - $375,800 |
| 37% | Over $751,600 | Over $626,350 | Over $626,350 | Over $375,800 |
| *Caution: Do not use these tax rate schedules to figure 2024 taxes. Use only to figure 2025 estimates. Source: Rev. Proc. 2024-40 | ||||
The marginal tax rate you expect to pay on your investments at retirement.
For Roth account, this is the total value of the account. For the pre-tax account this would include 1) The value of the account after you pay income taxes on all earnings and tax-deductible contributions and 2) what you would have earned if you had invested (in an ordinary taxable account) any income tax savings, if you choose to invest any of the tax savings.