INVESTMENTRetirementFinance Calculator
๐Ÿ’ฐ

Tax-Advantaged Savings โ€” Compare Account Types

See how Traditional, Roth, and taxable accounts grow. Tax advantage comes from rate arbitrage.

Concept Fundamentals
$43,456
Tax Advantage
$320,673
Traditional (after-tax)
$312,450
Roth
$277,217
Taxable

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Max employer match first Roth conversions in low-income years Tax-loss harvesting in taxable

Key figures
$43,456
Tax Advantage
Key figure
$320,673
Traditional (after-tax)
Key figure
$312,450
Roth
Key figure
$277,217
Taxable
Key figure

Ready to run the numbers?

Why: Tax-advantaged accounts beat taxable over time. Choose Traditional if current rate > retirement rate.

How: Traditional: pre-tax, tax-deferred. Roth: after-tax, tax-free. Taxable: pay tax on gains.

Max employer match firstRoth conversions in low-income years
Sources:IRS IRA RulesBogleheads

Run the calculator when you are ready.

Compare Accounts

Sample Scenarios

Savings Details

Yearly savings
$
Annual return
%
Marginal rate now
%
Expected at retire
%
Time horizon
years
tax_advantaged.sh
CALCULATED
$ analyze --type=tax-advantaged
Traditional (after-tax)
$320,673
Roth
$312,450
Taxable
$277,217
Tax Advantage
$43,456
Share:
Tax-Advantaged Savings Calculator
Tax Advantage
$43,456
Traditional: $320,673 | Roth: $312,450

Comparison Details

Contribution Details

Annual Contribution$6,500
Expected Return7.0%
Years25

Tax Rates

Current Rate24%
Retirement Rate22%

Account Values

Traditional (before tax)$411,119
Traditional (after tax)$320,673
Roth (tax-free)$312,450
Taxable Account$277,217
Tax Advantage$43,456

Get AI-Powered Analysis

Get personalized account strategy advice.

For educational purposes only โ€” not financial advice. Consult a qualified advisor before making decisions.

๐Ÿ’ก Money Facts

Match

Free money first

โ€” 401k

Roth

Tax-free growth

โ€” IRA

Backdoor

High earners

โ€” Roth

๐Ÿ“‹ Key Takeaways

  • โ€ข Traditional: tax deduction now, pay taxes at withdrawal. Roth: no deduction, tax-free withdrawals.
  • โ€ข Choose Traditional if current tax rate > retirement rate; Roth if current < retirement.
  • โ€ข Max out employer 401(k) match first; diversify between Traditional and Roth.
  • โ€ข Tax-advantaged accounts beat taxable over time; consider backdoor Roth for high earners.

๐Ÿ’ก Did You Know?

If tax rates are the same now and in retirement, Traditional and Roth are mathematically equivalent. The benefit comes from rate arbitrage.

๐Ÿ“– How It Works

Traditional: contribute pre-tax, grow tax-deferred, pay tax on withdrawal. Roth: contribute after-tax, grow tax-free, withdraw tax-free. Taxable: pay tax on gains annually (or at sale).

๐ŸŽฏ Expert Tips

  • โ€ข Employer match is free moneyโ€”max it first
  • โ€ข Roth conversions in low-income years
  • โ€ข Tax-loss harvesting in taxable accounts

โ“ FAQ

Traditional or Roth?

Depends on current vs expected retirement tax rate. Young workers often prefer Roth.

What about taxable?

Use for overflow after maxing tax-advantaged. Tax-efficient funds help.

๐Ÿ“š Sources

  • โ€ข IRS โ€“ IRA and 401(k) rules
  • โ€ข Bogleheads โ€“ Tax-advantaged accounts

โš ๏ธ Disclaimer: This calculator provides estimates. Consult a tax advisor. Not financial advice.

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