You should explore all of your retirement savings options in order to ensure that you are getting the most returns for a comfortable retirement. Use this calculator helps you compare your possible returns from contributions to a traditional 401(k) savings account versus to a Roth 401(k) account.
Enter your current age.
Enter the age at which you wish to retire.
Enter the age you expect to live to.
Enter your current income.
Wage Growth Percentage
Enter the percentage by which you expect your wages to grow. Typically, 3% - 5%
401(k) Contribution Percentage
Enter the percentage of your income you contribute annually to your 401(k) retirement
Pre-Retirement Rate of Return
Enter the rate of return you expect to achieve on your pre-retirement investments.
Post-Retirement Rate of Return
Enter the rate of return you expect to achieve after retirement on your investments.
Tax Rate During Your Earning Years
Enter your tax rate while you are earning income.
Tax Rate During Your Retirement Years
Enter the tax rate you anticipate during your retirement years. This rate may be lower than during your earning years because you may generate less income from your savings than you earned while working.
The calculator generates two Roth 401(k) plans for you to compare. Roth 1 uses the
same contribution amount as the traditional 401(k) plan. Roth 1 requires that you
pay taxes on contributions which will reduce your annual take home pay by
$0. Roth 2 adjusts the
contribution amount to include taxes and your take home pay is the same as the traditional
Annual Contribution Before Tax
Annual contributions for a traditional 401(k), a Roth 401(k) with the same contribution
amount and a Roth 401(k) with an adjusted contribution amount such that your annual
take home pay is the same as a traditional 401(k).
Annual contribution taxes. Taxes on a traditional 401(k) are deferred. Taxes on
Roth 401(k) contributions are paid at the time the contribution is made.
Total Annual Contribution After Tax
The value in "today's dollars" of your monthly retirement income adjusted for inflation.
Annual After Tax Income
Your annual income after taxes and 401(k) contributions have been deducted.
401(k) Balance at Retirement
Balance of your 401(k) savings account when you retire.
Annual Income Before Taxes
Annual income generated by your 401(k) savings plan when you retire and stop making
Annual Tax on Retirement Income
Annual taxes on income generated by your 401(k) savings plan. Roth 401(k) plans
are not taxed during retirement.
Annual After Tax Retirement Income
Annual income after deducting taxes generated by your 401K savings plan when you
retire and stop making contributions.
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Tax Foundation Federal Individual Income Tax Rates table.
SmartMoney.com article: Understanding the Roth 401(k).
Path to Investing offers clear, objective, and practical information, including information about traditional and roth 401(k)s.