★ MONEY · RETIREMENT · COMPARISONS
At $7,000 a year for 35 years at 7%, both IRAs end at $754,773.36 after tax when the brackets match — a tie. The Traditional grows to $967,658.15 before tax; the Roth grows to $754,773.36 tax-free. Change the retirement bracket and the tie breaks — by $29,029.74 at 25%, and by $96,765.81 at 12%.
At $7,000 a year for 35 years at 7%, the Traditional balance is $967,658.15 and the Roth balance is $754,773.36 tax-free. The calculator below runs your contribution, horizon, return, and both brackets.
The two IRAs tax the same money at different moments, and that timing is the whole comparison. A Traditional IRA takes the full $7,000 a year before tax, so all $7,000 grows; the tax is paid once, at withdrawal, on the whole balance. A Roth IRA takes the tax first: at a 22% current bracket, $7,000 costs $1,540 in tax and only $5,460 a year actually goes in, but nothing is ever taxed again. Both balances grow at the same 7% for the same 35 years, so the only question is which tax rate ends up lower — the one today or the one in retirement.
At the defaults the answer is a tie, and the tie is not a coincidence — it is arithmetic. Future value is the annual payment times ((1 + r)^n − 1) / r: $7,000 × ((1.07)^35 − 1) / 0.07 = $967,658.15. The Roth contributes $5,460 a year, which is $7,000 × (1 − 0.22), so its balance is the same formula with a smaller payment: $754,773.36, all tax-free. The Traditional balance of $967,658.15 is taxed at the 22% retirement bracket, leaving $967,658.15 × 0.78 = $754,773.36 — exactly the Roth balance. When the two brackets match, the tax rate cancels out entirely, and the accounts tie no matter what the return or the horizon is.
Setup: annual contribution $7,000; years 35 (age 30 to 65); annual return 7%; current bracket 22%; retirement bracket 22%.
Line 1 — the growth factor. ((1.07)^35 − 1) / 0.07 = 138.23688. One dollar a year for 35 years at 7% becomes $138.24.
Line 2 — the Traditional balance. $7,000 × 138.23688 = $967,658.15 before tax.
Line 3 — the Roth contribution. $7,000 × (1 − 0.22) = $7,000 × 0.78 = $5,460 a year after tax.
Line 4 — the Roth balance. $5,460 × 138.23688 = $754,773.36, and no tax is ever due on it.
Line 5 — the Traditional balance after tax. $967,658.15 × (1 − 0.22) = $967,658.15 × 0.78 = $754,773.36.
Line 6 — the verdict. $754,773.36 vs $754,773.36 — a tie, a difference of $0.00.
Line 7 — what you paid in. $7,000 × 35 = $245,000 in total contributions; the rest, $967,658.15 − $245,000 = $722,658.15, is investment growth.
Line 8 — the Roth lifetime tax. $1,540 a year × 35 = $53,900 paid in tax over the whole period, all of it up front.
20 years: the Traditional balance is $7,000 × ((1.07)^20 − 1) / 0.07 = $286,968.45; the Roth balance is $5,460 × the same factor = $223,835.39. After a 22% retirement tax the Traditional leaves $223,835.39 — still a tie, because equal brackets always tie.
10 years: the Traditional balance is $96,715.14 and the Roth balance is $75,437.81. After tax at 22% the Traditional leaves $75,437.81 — the tie holds at any horizon.
10% return over 35 years: the Traditional balance jumps to $1,897,170.58 and the Roth to $1,479,793.05. After tax at 22% the Traditional leaves $1,479,793.05 — the tie holds at any return, because both sides grow by the same factor.
$6,000 a year ($500 a month) over 35 years: the Traditional balance is $829,421.27 and the Roth balance is $646,948.59. After tax at 22% the Traditional leaves $646,948.59 — the tie holds at any contribution, too.
Retirement bracket 25%: the Traditional balance after tax is $967,658.15 × 0.75 = $725,743.61, against a Roth balance of $754,773.36. The Roth wins by $29,029.74. A higher bracket in retirement punishes the Traditional, because the tax falls on the whole balance including all the growth.
Retirement bracket 12%: the Traditional balance after tax is $967,658.15 × 0.88 = $851,539.17, against a Roth balance of $754,773.36. The Traditional wins by $96,765.81. A lower bracket in retirement rewards the Traditional, because the tax is paid later at a cheaper rate.
Max-out branch — Roth $7,000 after tax vs Traditional $7,000 before tax: if you can put the full $7,000 into the Roth after paying tax on it, the Roth balance is the full $967,658.15 tax-free, while the Traditional after tax at 22% is $754,773.36. The Roth wins by $212,884.79 — because the Roth shelters more of your money: it costs $7,000 plus $1,974 in tax each year to max it out, against $7,000 before tax for the Traditional.
Reverse — the break-even retirement bracket: the break-even retirement bracket is 22%, exactly your current bracket. Retire in a bracket below 22% and the Traditional wins; retire in a bracket above 22% and the Roth wins. The break-even is always the current bracket, whatever the return, the horizon, or the contribution.
Contributions are made once a year at the end of each year, for 35 years, and the return is a flat 7% every year — real returns vary year to year, and a flat average understates the effect of bad years early on. The tax brackets are flat rates applied to the whole amount; real tax is marginal, so the bracket that matters is the rate on the last dollar, not your average rate. The model ignores contribution limits, income limits, employer matches, the 10% early-withdrawal penalty before age 59½, state taxes, and the fact that Traditional IRAs have required minimum distributions starting at age 73 (age 75 if you were born in 1960 or later), while Roth IRAs have no required minimum distributions for the owner. The $7,000 figure is only the worked-example amount used on this page, not a stated contribution limit. Rounding convention: money is rounded to cents and all figures are computed from unrounded values, rounded only for display.
| Output | Formula | What it means |
|---|---|---|
| Traditional IRA balance | PMT × ((1+r)^n − 1)/r | $967,658.15 before tax at the defaults. |
| Roth IRA balance | PMT × (1 − current bracket) × factor | $754,773.36 tax-free at the defaults. |
| Traditional after tax | balance × (1 − retirement bracket) | $754,773.36 at a 22% retirement bracket. |
| Difference | Roth balance − Traditional after tax | $0.00 — a tie at the defaults. |
| Total contributions | PMT × years | $245,000 over 35 years. |
| Investment growth | balance − contributions | $722,658.15 of the balance is growth. |
| Roth lifetime tax | PMT × current bracket × years | $53,900 paid up front over 35 years. |
| 20 years | same formula, n = 20 | $286,968.45 Traditional; Roth $223,835.39 — tie after tax. |
| 10 years | same formula, n = 10 | $96,715.14 Traditional; Roth $75,437.81 — tie after tax. |
| 10% return, 35 years | same formula, r = 10% | $1,897,170.58 Traditional; Roth $1,479,793.05 — tie after tax. |
| $6,000 a year, 35 years | same formula, PMT = $6,000 | $829,421.27 Traditional; Roth $646,948.59 — tie after tax. |
| Retirement bracket 25% | balance × 0.75 | $725,743.61 — Roth wins by $29,029.74. |
| Retirement bracket 12% | balance × 0.88 | $851,539.17 — Traditional wins by $96,765.81. |
| Max-out branch | Roth $7,000 after tax vs Traditional $7,000 before tax | $967,658.15 vs $754,773.36 — Roth wins by $212,884.79. |
| Break-even retirement bracket | equals the current bracket | 22% at the defaults. |
The math is exact for the numbers you enter: future value is the annual payment times ((1 + r)^n − 1) / r, the Roth contribution is the payment times one minus the current bracket, and the Traditional after-tax balance is the balance times one minus the retirement bracket. The tie at equal brackets is a mathematical identity, not an approximation — it holds at any return, horizon, or contribution. What the model cannot do is predict your future bracket: that depends on your income, your other retirement income, future tax law, and where you live, and a single flat rate is a simplification of a marginal tax system. It also ignores required minimum distributions: Traditional IRAs force withdrawals starting at age 73 (age 75 if you were born in 1960 or later), while Roth IRAs have no required minimum distributions for the owner, which matters for estate planning even when the balances tie. Read the Roth vs Traditional IRA guide for the full picture.
Bright Side Kit. "Roth vs Traditional IRA Calculator: Which Wins in 2026?" https://brightoolbox.com/roth-ira-vs-traditional-ira/ Accessed October 24, 2026.For the final balance, no — they tie exactly at $754,773.36. When the current and retirement brackets are both 22%, the tax rate cancels out and both accounts leave you with the same after-tax amount, whatever the return or horizon. What still differs is flexibility: the Traditional forces required minimum distributions starting at age 73 (age 75 if you were born in 1960 or later), while the Roth has no owner RMDs, and Roth contributions (not earnings) can be withdrawn any time without penalty.
Because the Roth taxes the small amount now and the Traditional taxes the big amount later. At a 25% retirement bracket the Traditional balance of $967,658.15 loses a quarter of itself, leaving $725,743.61, while the Roth keeps its full $754,773.36. The Roth wins by $29,029.74. The tax falls on the whole balance including all $722,658.15 of growth, so a higher later rate hurts the Traditional most.
Because you pay the tax later at the cheaper rate. At a 12% retirement bracket the Traditional keeps $851,539.17 of its $967,658.15, beating the Roth's $754,773.36 by $96,765.81. You deducted at 22% and paid at 12% — that 10-point gap on nearly a million dollars is where the win comes from.
When both accounts get the same $7,000, the Roth shelters more money. A $7,000 Roth contribution costs $7,000 plus $1,974 of tax, because the tax is paid from outside the account; a $7,000 Traditional contribution costs only $7,000 before tax. So the Roth ends at the full $967,658.15 tax-free while the Traditional ends at $754,773.36 after tax — a $212,884.79 Roth win. The catch is that maxing out a Roth costs more cash each year.
Traditional IRAs must start withdrawals at age 73 (age 75 if you were born in 1960 or later); Roth IRAs have no owner RMDs. RMDs do not change the balance math on this page, but they change your life: a Traditional forces taxable income in retirement whether you need it or not, which can push you into a higher bracket, while a Roth lets the money keep growing untouched.
No — $7,000 is only the worked-example amount on this page. It is a round number that makes the arithmetic easy to follow. Contribution limits change over time and depend on your age and income, so check the current rules before you contribute.
Then the accounts tie, and you should choose on the other factors. At equal brackets both end at $754,773.36 after tax. Pick the Roth if you value no RMDs and tax-free growth you can leave alone; pick the Traditional if you want the deduction now and expect to need the money in retirement anyway.
Yes — many savers split between the two. Holding both hedges the bracket bet: if your retirement bracket ends up higher, the Roth half wins; if it ends up lower, the Traditional half wins. Run this calculator twice, once for each account, to see the split.