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Roth vs Traditional IRA Calculator
Designed to help you determine which retirement savings option best suits your financial goals.
Compare Your Retirement Options
With our IRA calculator, you can evaluate the potential benefits of Roth and Traditional retirement accounts by inputting key financial details. This comparison assists you in making informed decisions about your retirement planning.
You have questions? We have answers.
After you crunch your numbers on the calculator, the next step is to give us a call! We can help answer questions you may have or direct you to the next step to starting your retirement savings!
Why Use UCCU’s Retirement Account Calculator?
- Personalized Analysis: Tailor the inputs to reflect your unique financial situation for a customized comparison.
- Informed Decision-Making: Understand the long-term impacts of each account type to choose the best fit for your retirement goals.
- Tax Considerations: Evaluate how current and future tax rates may influence your retirement savings strategy.
Understanding the Calculator Fields
To provide accurate comparisons, the calculator requires the following inputs:
- Current Age: Your present age to estimate the investment horizon until retirement.
- Retirement Age: The age at which you plan to retire, determining the investment growth period.
- Annual Contribution: The amount you intend to contribute each year to your retirement account.
- Current Tax Rate: Your current federal income tax bracket, influencing the immediate tax benefits of Traditional accounts.
- Expected Tax Rate in Retirement: The anticipated tax bracket during retirement, affecting the taxation of withdrawals.
- Expected Rate of Return: The projected annual return on your retirement investments.
By entering these details, the calculator provides a side-by-side comparison of the potential future values of Roth and Traditional retirement accounts, considering tax implications and growth over time.
Get Started Today
Explore UCCU’s Roth vs. Traditional IRA Calculator to make informed decisions about your retirement savings. For personalized assistance, contact our Retirement Planning Specialists at 801-223-7650 or [email protected].
*Note: The calculator provides estimates for informational purposes only. Actual account performance and tax implications may vary. Consult a financial advisor for personalized advice.*
What is the difference between a Roth and a Traditional retirement account?
Learn about the differences between a ROTH and a Traditional IRA
- Roth Accounts: Contributions are made with after-tax dollars, so qualified withdrawals in retirement are tax-free.
- Traditional Accounts: Contributions may be tax-deductible now, but withdrawals during retirement are taxed as regular income.
What factors should I consider when choosing between Roth and Traditional?
Key factors include:
- Your current tax rate vs. your expected tax rate in retirement.
- Whether you prefer tax savings now (Traditional) or tax-free withdrawals later (Roth).
- Your investment time horizon and financial goals.
How do current and future tax rates affect my decision?
If you expect to be in a higher tax bracket during retirement, a Roth account may be more beneficial since withdrawals are tax-free. If you anticipate being in a lower tax bracket, a Traditional account could help you save on taxes today.
Can I contribute to both Roth and Traditional accounts?
Yes, as long as you meet the IRS eligibility requirements. However, the total contributions to both accounts cannot exceed the annual contribution limit ($6,500 in 2024 or $7,500 if you’re 50 or older).