Understanding the Traditional IRA
A Traditional IRA (Individual Retirement Arrangement) is a personal retirement account you open at any broker or bank, independent of any employer. Money you contribute may reduce your taxable income this year (see the deduction rules below), and everything inside the account — contributions and investment growth alike — compounds without being taxed year to year. The trade-off comes at the other end: when you eventually withdraw the money in retirement, the full withdrawal is taxed as ordinary income, since none of it was ever taxed on the way in. This is the mirror image of a Roth IRA, where you pay tax upfront and withdrawals in retirement are tax-free.
Anyone with earned income can open one, and unlike a Roth, there's no income limit that blocks you from contributing to a Traditional IRA — high earners can always put money in, though as covered below, whether that contribution is deductible is a separate question tied to income and workplace-plan coverage.
How This Calculator Works
The projection uses the standard compound-growth formula for an account that gets a lump sum today plus a regular contribution every year, with P as your starting balance, C as the annual contribution, r as the expected annual return, and n as the number of years until retirement:
Each contribution is assumed to land at the end of the year, then grow along with everything already in the account. The year-by-year schedule table below builds this up one year at a time — beginning balance, that year's growth, that year's contribution, ending balance — so you can see exactly how the total forms rather than just taking the final number on faith. Growth here means investment returns only; it isn't a tax calculation, since taxes on a Traditional IRA aren't triggered until withdrawal.
What Each Input Means
Current age and retirement age set how many years the account has to compound — even a few extra years can meaningfully change the outcome given how compounding accelerates over time. Current IRA balance is whatever you already have saved in Traditional IRAs today (enter $0 if you're starting fresh). Annual contribution is what you plan to add each year — the chips above the field are shortcuts for the 2026 IRS limits, $7,500 if you're under 50 or $8,600 if you're 50 or older (that extra $1,100 is the "catch-up" contribution). Expected annual return is your assumed long-run growth rate; a diversified stock-heavy portfolio has historically averaged roughly 7-10% before inflation over long periods, though any individual decade can look very different, and future returns are never guaranteed.
Is Your Contribution Tax-Deductible?
This is the part of Traditional IRAs people get wrong most often: the contribution limit and the deduction are two separate things. You can always contribute up to the annual limit regardless of income. Whether you can deduct that contribution from your taxable income depends on one question: does anyone in your household have access to a workplace retirement plan this year?
If neither you nor your spouse is covered by a workplace plan (like a 401(k) or 403(b)), your contribution is fully deductible no matter how much you earn. If you are covered, the deduction phases out over a specific Modified Adjusted Gross Income (MAGI) range set by the IRS each year — for 2026, that's $81,000-$91,000 for single filers, $129,000-$149,000 for married couples filing jointly (when the contributing spouse is the one covered), and a much wider $242,000-$252,000 if you aren't covered yourself but your spouse is. Married filing separately gets a notably unforgiving $0-$10,000 range that isn't adjusted for inflation. Check the box above the Calculate button to see where your own numbers land — the calculator applies the same rounding rule the IRS uses (round up to the next $10, with a $200 floor once you're anywhere inside the phase-out range rather than fully phased out).
One thing that surprises people: even a fully nondeductible contribution isn't useless. The money still grows tax-deferred, and it establishes "basis" you track on IRS Form 8606 so you're not taxed twice on that portion when you eventually withdraw it. It's also the building block of the "backdoor Roth" strategy some high earners use to get money into a Roth despite being over the Roth's own income limit.
Traditional vs. Roth: Which Actually Wins?
The Traditional vs. Roth tab above runs the single most useful comparison for this decision: it holds the pretax dollar amount you're setting aside constant, then asks what happens if that same money is taxed today (Roth) versus taxed later, at whatever rate applies when you withdraw it (Traditional). The math reduces to one clean rule: if your tax rate will be lower in retirement than it is today, Traditional wins; if it will be higher (or the same), Roth wins or ties. That's because paying a smaller percentage in tax always beats paying a larger one on the same pretax dollars — it genuinely doesn't matter whether the tax bite happens now or decades from now, only which rate is smaller.
In practice, most people's honest answer is "I don't know what tax rates will look like in 30 years." That uncertainty is exactly why many financial planners suggest splitting new contributions between both account types — it hedges against future tax-law changes and against not knowing your own retirement income level yet. People early in their careers, likely to be in a higher bracket later as income grows, often lean Roth; people at or near their peak earning years, expecting a lower-spending retirement, often lean Traditional.
The comparison panel adds a third column that is easy to overlook and is often the most persuasive one: regular taxable savings. That is the same money, invested the same way, in an ordinary account with no shelter — so its gains are taxed every single year rather than compounding untouched. Modelled at the opening figures, an ordinary account grows at an effective 5.46% instead of 7%, and finishes several hundred thousand dollars behind either IRA. The Traditional-versus-Roth question is worth thinking about; the shelter-versus-no-shelter question is usually worth far more.
What This Calculator Doesn't Cover
A few real-world factors aren't modeled here, on purpose, to keep the tool focused and honest about its limits. State income tax isn't included — a handful of states don't tax retirement withdrawals at all, and some don't tax income in the first place, which can shift the Traditional-vs-Roth math further than the federal comparison alone suggests. Required Minimum Distributions aren't factored into the growth projection — a Traditional IRA forces you to start withdrawing (and paying tax on) money at 73 or 75 whether you need the income or not, while a Roth IRA has no RMDs during the original owner's lifetime; the reference tool further down this page estimates a single year's RMD. Medicare IRMAA surcharges and Social Security taxability both depend on your overall income picture in a given year, including Traditional IRA withdrawals — a large RMD can push you into a higher Medicare premium bracket or make more of your Social Security benefit taxable, effects this calculator doesn't attempt to model. Finally, the Traditional-vs-Roth comparison assumes a level, static tax rate on each side; real tax brackets are progressive and marginal rates can shift with tax law changes, so treat the comparison as a directional guide rather than a precise prediction.
Should You Contribute This Year?
A reasonable order of operations many planners suggest: first, capture any employer 401(k) match in full, since that's an immediate 100% return before an IRA even enters the picture. From there, if you expect your tax rate to drop meaningfully in retirement (or you simply want the deduction now), a deductible Traditional contribution is straightforward. If you're not eligible for a deduction — MAGI above the phase-out range while covered by a workplace plan — it's worth directly comparing a nondeductible Traditional contribution against a Roth IRA (if your income still qualifies for one) or against simply investing in a regular taxable brokerage account, since giving up the deduction removes one of the Traditional IRA's two main advantages. If cash flow is tight, prioritizing the account with the higher expected lifetime tax savings — using the comparison tab above with your best honest guess at both tax rates — is a more useful test than defaulting to whichever account you already have open.
Required Minimum Distributions (RMDs)
Once you reach the applicable age, the IRS requires you to withdraw at least a minimum amount from your Traditional IRA every year, whether or not you actually need the money — and that withdrawal is taxed as ordinary income. Under the SECURE 2.0 Act, that age is 73 if you were born between 1951 and 1959, or 75 if you were born in 1960 or later. The required amount is your account's prior year-end balance divided by a life-expectancy "divisor" from the IRS Uniform Lifetime Table, which shrinks every year you age — so the required percentage of your balance rises over time, from roughly 3.8% at 73 up past 6% by your mid-80s. Miss an RMD and the IRS can assess a 25% excise tax on the shortfall (reduced to 10% if you correct it within two years) — this is one deadline genuinely worth calendaring. The reference tool further up this page gives a quick single-year estimate; the dedicated RMD Calculator is worth a look too if you want to model your RMDs on their own page. Roth IRAs, by contrast, have no RMDs at all during the original account owner's lifetime, which is one more point in Roth's favor for anyone who'd rather let the account keep compounding untouched.
Frequently Asked Questions
What's the 2026 IRA contribution limit?
$7,500 for 2026, or $8,600 including the $1,100 catch-up if you're 50 or older. This is a combined limit across all your Traditional and Roth IRAs together, not a separate limit for each.
Are Traditional IRA contributions always tax-deductible?
Not always. If neither you nor your spouse has access to a workplace retirement plan, your contribution is fully deductible no matter your income. If you (or your spouse) are covered by a workplace plan, the deduction phases out over a specific income range that depends on your filing status — above that range you can still contribute, just without the deduction.
What's the difference between a Traditional IRA and a 401(k)?
A 401(k) is employer-sponsored, has a much higher contribution limit ($24,500 for 2026), and its investment menu is chosen by your employer. A Traditional IRA is opened independently at any broker, has a lower contribution limit, but usually offers far more investment choice — and the two aren't mutually exclusive; many people use both.
Traditional IRA or Roth IRA — which is better for me?
It comes down to whether your tax rate is higher today or is likely to be higher in retirement. If you expect to be in a lower tax bracket in retirement than you are now, Traditional generally comes out ahead. If you expect a similar or higher bracket in retirement, Roth generally wins. Since nobody can know future tax law with certainty, many people split contributions between both to hedge that risk.
What happens when I withdraw from a Traditional IRA in retirement?
Withdrawals are taxed as ordinary income, since the contributions (if deducted) and all the growth along the way were never taxed. This is different from a Roth IRA, where qualified withdrawals are entirely tax-free.
When do I have to start taking money out (RMDs)?
Required Minimum Distributions start at age 73 if you were born between 1951 and 1959, or age 75 if you were born in 1960 or later. The amount is your prior year-end balance divided by an IRS life-expectancy divisor that shrinks every year, so the required percentage rises with age. Roth IRAs have no RMDs during the original owner's lifetime.
This calculator provides estimates for general informational purposes only and is not tax or financial advice. Contribution limits and phase-out ranges reflect 2026 IRS figures (Notice 2025-67) and change over time. Actual investment returns are never guaranteed — consult a qualified tax or financial advisor about your specific situation.
Contribution and deduction limits shown are for the 2026 tax year and change annually. Projections assume a constant rate of return and on-time contributions, and exclude fees. Provided for general information only and not tax, legal or investment advice — IRA rules depend on your income, filing status and workplace plan, so check your own position with a qualified adviser.