Compare Roth and Traditional 401(k) contributions using actual 2026 federal tax brackets and your projected retirement income — not a hand-waved 'future tax rate.' Models RMD-driven retirement income, real marginal rate at each level, and lifetime after-tax dollars under each strategy.
The Roth vs Traditional 401(k) decision is one of the most-googled personal finance questions, and most calculators get it wrong by asking you to guess your future tax bracket. The actual math is more nuanced because your retirement marginal rate is driven by the income you'll be drawing — which depends partly on what you choose to do here. Traditional contributions reduce taxable income now and create taxable Required Minimum Distributions later. Roth contributions are taxed now and create tax-free withdrawals later with no RMDs during your lifetime.
The fundamental math: if your marginal tax rate is identical now and in retirement, Traditional and Roth produce mathematically equal after-tax outcomes when the contributions are equivalent in pre-tax terms. The case for Traditional is rate arbitrage — paying tax later at a lower rate. The case for Roth is rate arbitrage in the other direction, plus three structural advantages: no RMDs during your lifetime, tax-free inheritance for heirs under the SECURE Act 10-year rule, and protection from future bracket increases (politically likely as the TCJA cuts sunset).
Most workers should default to Traditional during peak earning years, especially in the 24%, 32%, or 35% federal brackets. The math heavily favors taking the deduction at 35% to pay 22% (or less) on RMDs in retirement when you have no W-2 income. The exception is high savers whose retirement balance will be so large that RMDs push them right back into peak brackets — that's the population for whom Roth becomes more attractive even at high current rates.
This calculator uses the actual 2026 federal tax brackets (IRS Rev. Proc. 2025-11) and computes your true marginal rate at both your current income and projected retirement withdrawal level. The current rate is what you save now via Traditional. The retirement rate is what Traditional withdrawals will actually cost you — including the brackets they push into and your state tax exposure at retirement (which may differ from your state tax exposure today if you plan to relocate).
An optional 'invest the tax savings' mode models the rigorous version of the comparison: Traditional contributor invests the upfront tax savings in a taxable brokerage account, growing at the same return rate, with long-term capital gains tax on the growth at withdrawal. With perfect execution this nearly equalizes Traditional and Roth at the same rate. In reality almost no one does this — most people spend the tax savings — which is why Roth often outperforms in practice even with identical brackets.
What's missing from the simple comparison: RMDs interact with Social Security taxation (the 'tax torpedo') and IRMAA Medicare premium surcharges, creating effective marginal rates 10-20 points higher than the bracket alone suggests. Heirs face the SECURE Act 10-year rule on inherited Traditional 401(k)s, paying tax during their peak earning years. The Roth structure escapes both of these. Run this calculator first for the headline answer, then use the RMD Forecaster and Tax Cliff Map for the full retirement-phase picture.