Roth 401k Calculator — Project Your Tax-Free Retirement Savings (2025)

With a Roth 401(k), you contribute after-tax dollars now, but all qualified withdrawals in retirement are completely tax-free—including both your contributions and all investment growth. With a traditional 401(k), you get a tax deduction now, but pay ordinary income tax on every dollar you withdraw in retirement. A Roth 401(k) is ideal if you expect to be in an equal or higher tax bracket in retirement, or want tax diversification for retirement income planning.

Choose Roth 401(k) if you're younger, currently in a lower tax bracket, or want tax-free income in retirement. Choose traditional 401(k) if you're in your peak earning years and a high tax bracket now, or expect to be in a lower bracket in retirement. Many financial advisors recommend splitting contributions between both types for tax diversification. Use our calculator to compare scenarios, or contribute to both types simultaneously if your employer allows it.

Most employers match 50% or 100% of your contributions up to a percentage of your salary (commonly 6%). To get the full match, you must contribute at least that percentage. For example, if your employer matches 50% up to 6% of salary and you earn $60,000, contribute at least 6% ($3,600/year) to receive the maximum $1,800 match. Always contribute enough to get the full match—it's an immediate 50-100% return on your money.

The 2025 employee contribution limit is $23,500. If you're age 50 or older, you can contribute an additional $7,500 in catch-up contributions, for a total of $31,000. There's also an overall limit of $70,000 (or $77,500 with catch-up) for employee plus employer contributions combined. The Roth 401(k) calculator automatically applies these limits and adjusts for catch-up contributions starting at age 50.

Use our Roth 401(k) calculator to see your final projected balance, then compare it to a taxable investment scenario. For example, a $500,000 Roth 401(k) balance means you can withdraw the entire amount tax-free in retirement. In a traditional 401(k) or taxable account, you'd owe income tax on withdrawals—potentially $100,000-$150,000 in taxes depending on your retirement tax bracket. The tax-free nature of Roth withdrawals means every dollar in your account is yours to spend.

Yes, you can contribute to both a Roth 401(k) and Roth IRA in the same year—they have separate limits. The Roth 401(k) 2025 limit is $23,500 ($31,000 with catch-up), while the Roth IRA limit is $7,000 ($8,000 with catch-up). Having both accounts provides maximum tax-free retirement savings flexibility. If you're a high earner, the Roth 401(k) has no income limits unlike the Roth IRA, making it accessible to everyone regardless of income.

When changing jobs, you have four options: 1) Leave it with your former employer (if allowed), 2) Roll it over to your new employer's Roth 401(k), 3) Roll it into a Roth IRA, or 4) Cash it out (not recommended). Rolling to a Roth IRA often provides more investment options and eliminates required minimum distributions (RMDs). The calculator can help you project growth regardless of where you keep the account, as long as you maintain the same contribution strategy.

Historical S&P 500 returns average around 10% annually, but conservative planning uses 6-8% to account for inflation and volatility. Young investors with 30+ years until retirement can reasonably expect 8-10% returns from a diversified stock portfolio. For shorter timelines or conservative investors, use 5-6%. The calculator's default 7% is realistic for a balanced, long-term investment strategy. Remember, past performance doesn't guarantee future results, so it's wise to run scenarios with different return rates to understand the range of possible outcomes.