Does this include growth?

No. This compares immediate after-tax effects on contributions; growth would scale both, but taxes differ on withdrawal.

Not enforced here; enter realistic deferral amounts within annual limits.

What about employer match tax status?

Match is always pre-tax; shown for reference but taxed on withdrawal in traditional form.

Does this consider RMDs or 59½ rules?

No. It’s a simple take-home vs withdrawal tax snapshot.

If you expect higher tax rates later, Roth can be better; lower later may favor Traditional. Run multiple scenarios.

finance calculator

Roth 401(k) vs Traditional 401(k)

Compare take-home impact and retirement after-tax value for Roth vs Traditional 401(k) deferrals.

Results

Employee deferral amount: $10,000
Employer match: $4,000
Traditional: take-home reduction (after-tax cost): $7,800
Traditional: after-tax withdrawal (future): $8,000
Roth: take-home reduction (after-tax cost): $10,000
Roth: after-tax withdrawal (future): $10,000

How to use this calculator

Enter salary and deferral %.
Enter current marginal tax rate and expected retirement tax rate.
Enter employer match %.
Compare take-home impact and after-tax value for Roth vs Traditional.

Inputs explained

Current tax rate: Your marginal rate now; used to show take-home impact of deferrals.
Retirement tax rate: Expected marginal rate on traditional withdrawals in retirement.
Employer match: Matching percentage of salary; assumed same for both options.

How it works

Traditional reduces take-home by deferral × (1 − current tax); withdrawals taxed later at retirement tax rate.

Roth uses after-tax dollars now (full deferral reduces take-home) but withdrawals are tax-free later.

Match is the same for both; shown separately.

Formula

Deferral = Salary × Deferral %
Match = Salary × Match %
Traditional take-home reduction = Deferral × (1 − Current tax)
Traditional after-tax withdrawal = Deferral × (1 − Retirement tax)
Roth take-home reduction = Deferral (after-tax dollars)
Roth after-tax withdrawal = Deferral (tax-free)

When to use it

Deciding whether Roth or Traditional contributions are better given current vs future tax expectations.
Showing take-home difference today versus after-tax retirement value.
Comparing scenarios if you expect higher or lower tax rates later.

Tips & cautions

If you expect higher taxes later, Roth often wins; if lower later, Traditional may win.
Deferral limits apply to combined Roth/Traditional employee contributions; match is pre-tax.
Run multiple tax rate scenarios to see sensitivity.
Simplified; does not model growth, limits, phaseouts, or RMD rules.
Assumes flat tax rates now vs retirement; not bracketed.
Match is shown but not tax-modeled; focus is on employee deferral impact.

Worked examples

$100k salary, 10% deferral, 4% match, 22% now, 20% retirement

Deferral = $10,000; Match = $4,000
Traditional take-home reduction ≈ $7,800; After-tax withdrawal ≈ $8,000
Roth take-home reduction = $10,000; After-tax withdrawal = $10,000

$150k salary, 8% deferral, 22% now, 12% retirement

Deferral = $12,000
Traditional take-home reduction ≈ $9,360; After-tax withdrawal ≈ $10,560
Roth take-home reduction = $12,000; After-tax withdrawal = $12,000

Deep dive

Compare Roth vs Traditional 401(k) by entering salary, deferral %, tax rates now vs retirement, and employer match.

See take-home impact today and after-tax value later to choose the better option for your tax outlook.

FAQs

Does this include growth?: No. This compares immediate after-tax effects on contributions; growth would scale both, but taxes differ on withdrawal.
Are limits applied?: Not enforced here; enter realistic deferral amounts within annual limits.
What about employer match tax status?: Match is always pre-tax; shown for reference but taxed on withdrawal in traditional form.
Does this consider RMDs or 59½ rules?: No. It’s a simple take-home vs withdrawal tax snapshot.
How to decide?: If you expect higher tax rates later, Roth can be better; lower later may favor Traditional. Run multiple scenarios.

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