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traditional vs roth

Enter your own monthly numbers. The traditional 401(k) contribution is grossed up so both columns have the same take-home pay.

While you are working

Monthly income and the amount you save. The savings amount is the Roth contribution.

This is what goes into the Roth 401(k). The traditional contribution is calculated from it.

Flat rates on taxable pay, not a full tax-bracket calculation. Zero is allowed for state tax.

What the investments earn. Contributions go in at the end of each month and compound monthly.

In retirement

Monthly expenses are after tax. Traditional withdrawals are larger because tax comes out.

Monthly, after tax. The defaults split a 21% combined retirement rate into 12% federal and 9% state.

How this works. Both columns start from the same monthly gross income. The Roth contribution is the monthly savings amount, and it does not reduce taxable pay. The traditional contribution is that savings amount divided by (1 − the combined federal and state rate), so the tax savings are invested and take-home pay matches. FICA is calculated on gross income and is the same in both columns, because a 401(k) deferral does not reduce it.

FICA constants, 2026. Social Security is 6.2% up to a wage base of $184,500. Medicare is 1.45% on all wages. Additional Medicare is 0.9% on wages over $200,000 a year. Monthly income is annualized (× 12) before those limits are applied, then the tax is shown per month.

Assumptions. Income tax is the flat federal rate plus the flat state rate applied to taxable pay: gross minus the traditional contribution, or the full gross for Roth. Contributions are made at the end of each month and compound monthly. In retirement, the withdrawal comes out at the start of each month, and the remaining balance still earns that same monthly growth. No employer match, no other income, no fees, and no inflation adjustment.

These figures are illustrative only, not tax, legal, or investment advice. Real tax runs through brackets, credits, and filing status. For help with your books or taxes, contact Books & Taxes or call (510) 781-0300. Nothing you type is saved or sent anywhere.