Roth or Traditional 401(k)? Enter your salary, contribution, and tax brackets, and this free Roth 401k calculator shows the after-tax retirement value of each choice, plus the 50/50 split option, using 2026 contribution limits.
Educational tool, not financial advice. SavingsClub is not a licensed financial advisor.
Your tax brackets drive the Roth vs Traditional answer. Most retirees land one bracket lower than their working years, but younger workers early in their careers often expect the opposite.
A Roth 401(k) is a workplace retirement account funded with after-tax dollars. You pay income tax on the money before it goes in, and in exchange, qualified withdrawals in retirement come out completely tax-free, including every dollar of investment growth. It combines the high contribution limits of a 401(k) with the tax-free withdrawal treatment of a Roth IRA.
This Roth 401k calculator answers the question most people actually have: should my contributions be Roth or Traditional? It projects your balance with monthly compounding, employer match, and 2026 contribution limits, then compares the after-tax retirement value of each choice using your current and expected retirement tax brackets. It also shows the 50/50 split option, since splitting is a legitimate strategy rather than indecision.
Both accounts grow identically. The only difference is when the tax bill arrives.
Traditional 401(k): contributions are pre-tax, which lowers your taxable income today. Every withdrawal in retirement is taxed as ordinary income at whatever your rate is then.
Roth 401(k): contributions are after-tax, so there is no deduction today. Qualified withdrawals in retirement are entirely tax-free.
Because the growth is the same, the comparison reduces to one variable: your tax rate now versus your tax rate in retirement. Pay the tax at whichever rate is lower. If your current rate is higher, Traditional wins. If your retirement rate will be higher, Roth wins. If the two rates end up identical, the outcomes are mathematically equal, and the tiebreakers below decide it.
Roth and Traditional 401(k) contributions share one combined limit. For 2026, the employee limit is $24,500. Workers 50 and older can add an $8,000 catch-up (total $32,500), and workers age 60 to 63 get an $11,250 super catch-up (total $35,750) under SECURE 2.0. Employer matching contributions are separate and do not count against your employee limit. Verify current figures at the IRS website.
One 2026 rule change matters for high earners: if your prior-year wages from your employer exceeded $150,000, any catch-up contributions you make must now go in as Roth, not pre-tax. If you are 50 or older and above that wage threshold, part of your contribution is going Roth whether you chose it or not, which makes understanding the Roth side of your plan less optional than it used to be.
People often conflate these two. They share the word Roth and the tax-free withdrawal treatment, but the practical differences are large:
| Feature | Roth 401(k) | Roth IRA |
|---|---|---|
| 2026 contribution limit | $24,500 ($32,500 if 50+) | $7,500 ($8,600 if 50+) |
| Income limits | None, anyone can contribute | Phases out at higher incomes |
| Employer match | Yes, if your employer offers one | No |
| Investment choices | Limited to your plan's menu | Nearly unlimited |
| RMDs in your lifetime | None (since 2024) | None |
| Who runs it | Your employer's plan | You, at any brokerage |
They are also not mutually exclusive. You can contribute to both in the same year, since they have separate limits. A common combination is contributing to the 401(k) at least up to the employer match, then funding a Roth IRA for its flexibility and investment choice. Check your Roth IRA eligibility and projection with our Roth IRA Calculator.
Early-career workers in low brackets. If you are in the 10%, 12%, or even 22% bracket now and expect your income to climb, paying tax at today's rate is cheap. Decades of tax-free compounding on top of that is the strongest Roth case there is.
High earners locked out of the Roth IRA. The Roth IRA phases out at higher incomes; the Roth 401(k) has no income limit at all. For a high earner, the Roth 401(k) is often the only direct path to a meaningful pile of tax-free retirement money.
People who expect higher tax rates later, whether from their own income trajectory or from a belief that tax law will get less generous. The Roth converts that uncertainty into a rate locked in today.
Who tends to win with Traditional instead: peak-earning workers in the 32% to 37% brackets who realistically expect to spend retirement in a much lower bracket. Deferring tax from 35% down to 22% or 12% is a large, fairly reliable win. Our 401(k) Calculator models the full balance projection with salary growth if you want the deeper year-by-year view.
Even if you direct 100% of your own contributions to Roth, your employer's matching dollars traditionally land in a pre-tax bucket. That means most "Roth" 401(k) owners actually retire with two piles: their own tax-free Roth money and a taxable Traditional pile built from the match. Plan for withdrawals from both.
SECURE 2.0 now lets plans offer a Roth employer match, but there is a catch: if you elect it, the match counts as taxable income to you in the year your employer makes it. Some people happily pay that tax for more tax-free growth; others prefer the default. Either way, capture the full match first, in whichever form your plan offers, because leaving match dollars unclaimed loses more than any Roth vs Traditional decision ever will. Your take-home pay also changes when you switch to Roth, since the tax comes out now; check the paycheck impact with our Take-Home Pay Calculator.
Switching to Roth without adjusting for the smaller paycheck. A 100% Roth contribution costs more take-home pay than the same percentage Traditional. If the tighter paycheck causes you to lower your contribution rate, the switch made you worse off.
Assuming retirement means a lower bracket. It usually does, but not always. Large Traditional balances plus Social Security plus RMDs can push retirees into surprisingly high brackets. Tax diversification exists precisely for this.
Forgetting the five-year rule. Tax-free Roth 401(k) withdrawals generally require the account to be at least five years old and you to be 59 and a half or older. Opening a Roth 401(k) shortly before retiring can start that clock later than people expect.
Treating the choice as permanent. It is not. You can change your Roth vs Traditional election for future contributions at any time in most plans, and revisit it whenever your bracket changes. The right answer at 25 is often the wrong one at 45. A yearly check with this calculator, or with our broader Retirement Calculator, is enough.
It depends on one question: do you expect a higher or lower tax rate in retirement than today? If higher, Roth usually wins because you pay tax now at the lower rate. If lower, Traditional usually wins because you defer tax until the lower rate applies. If you genuinely do not know, many educators suggest splitting contributions between both for tax diversification.
The 2026 limit is $24,500, shared between Roth and Traditional 401(k) contributions combined. Workers 50 and older can add an $8,000 catch-up (total $32,500), and workers age 60 to 63 get an $11,250 super catch-up (total $35,750). Employer matching contributions do not count against these limits.
No. Unlike a Roth IRA, which phases out at higher incomes, anyone can contribute to a Roth 401(k) regardless of how much they earn, as long as their employer's plan offers the Roth option. This makes the Roth 401(k) the main way high earners get Roth-style tax-free growth.
By default, employer matching contributions go into a pre-tax (Traditional) bucket even if your own contributions are Roth, so that portion is taxed at withdrawal. Under SECURE 2.0, plans may now offer a Roth employer match, but if you take it, the match counts as taxable income to you in the year it is made. Check what your specific plan offers.
No. Starting in 2024, SECURE 2.0 eliminated required minimum distributions from Roth 401(k) accounts during the owner's lifetime, matching the Roth IRA treatment. Traditional 401(k) balances still have RMDs, currently beginning at age 73.
Yes, if your plan offers both. Most large plans let you direct any percentage of your contribution to each side, and the two share one combined annual limit ($24,500 in 2026). A split hedges against future tax rates being different than you expect and gives you flexibility to manage your tax bracket in retirement.