Roth IRA vs Traditional IRA: Which One Wins for You?
The two IRAs hold the same money under the same $7,500 limit — the entire difference is when you pay tax. A traditional IRA gives a deduction now and taxes your withdrawals later. A Roth IRA taxes the contribution now and lets every dollar grow and come out tax-free. Which wins is a math question about your tax rate today versus your tax rate in retirement.
The only number that matters: your rate now vs later
If your tax bracket today is higher than it will be in retirement, the traditional IRA’s deduction saves more than the Roth’s later tax-free withdrawals cost — traditional wins. If you expect to be in a higher bracket later (promotions, a working spouse, big RMDs from a 401(k)), the Roth’s tax-free growth wins. The Roth vs traditional calculator runs this comparison with your exact rates and shows the after-tax outcome at retirement.
The 2026 limits
Both accounts share the same 2026 limit: $7,500 ($8,600 at age 50+ with the $1,100 catch-up). You can hold both and split the contribution, but the total across all IRAs is capped. The IRA limit calculator checks both the cap and any phase-outs.
A worked comparison
Contribute the full $7,500 every year for 25 years at 7% and the account reaches about $632,000 before tax. From there it is pure rate math: at a 22% marginal rate now and 15% in retirement, the traditional IRA nets about $537,600 after tax, while the Roth nets about $493,300 — traditional wins by roughly $44,000, because you kept the 22% deduction and withdrew at 15%. Flip the rates (12% now, 22% later — early career) and the Roth wins by the same logic. The comparison calculator runs your exact two rates.
The differences that change the answer
| Traditional IRA | Roth IRA | |
|---|---|---|
| Contribution now | Tax-deductible (at your marginal rate) | Not deductible |
| Growth | Tax-deferred | Tax-free forever |
| Withdrawals in retirement | Taxed as ordinary income | Tax-free (after 59½ + 5-year rule) |
| RMDs at 73 | Required | None — the account can pass untouched |
| Income limit | Deduction phases out only if covered by a workplace plan | Contributions phase out at $153k–$168k single / $242k–$252k joint |
Rules of thumb
- Pick Roth when you are early in your career, in the 10–12% brackets, or expect RMDs to push you into a higher bracket later.
- Pick traditional when you are in a high bracket now (24%+) and expect to withdraw at a lower rate in retirement.
- Above the Roth income limit? Use a backdoor Roth — contribute to a traditional IRA after tax and convert. The Roth conversion guide explains the costs and the pro-rata rule.
Run your numbers
Compare the two with the Roth vs traditional calculator, check the limit with the IRA limit calculator, and see how a 401(k) changes the picture in the 401(k) limits guide.
Sources: IRS Retirement Topics — IRA Contribution Limits (2026); IRS Publication 590-A.