Roth Conversion Calculator

What this tool does

Calculate roth conversion from your own entered figures. Each converted amount has its own 5-year conversion clock for penalty-free access to the converted principal before 59½; bracket-filling, IRMAA, state tax and the pro-rata rule are not modelled.

How to use the Roth Conversion Calculator

1. Enter or select amount converted to roth this year.
2. Enter or select marginal tax rate on the conversion (%).
3. Enter or select expected tax rate in retirement (%).
4. Enter or select expected annual return (%).
5. Enter or select years until the money is withdrawn.
6. Read the calculated result; change any measurement to compare alternatives.

Formula

tax cost now = conversion × today's marginal rate; converted amount then grows tax-free, while leaving it traditional grows the same and is taxed at the retirement rate — the advantage compares the Roth outcome with the traditional outcome after also growing the tax paid today at the same return

amount

Amount converted to Roth this year

taxNow

Marginal tax rate on the conversion (%)

taxRet

Expected tax rate in retirement (%)

ret

Expected annual return (%)

years

Years until the money is withdrawn

Each converted amount has its own 5-year conversion clock for penalty-free access to the converted principal before 59½; bracket-filling, IRMAA, state tax and the pro-rata rule are not modelled.

Worked example

For roth conversion calculator, the following measurements illustrate the exact method: Amount converted to Roth this year: 50000; Marginal tax rate on the conversion (%): 22; Expected tax rate in retirement (%): 12; Expected annual return (%): 7; Years until the money is withdrawn: 20.

Results explained

Tax due on the conversion this year

Tax due on the conversion this year from the formula above. Each converted amount has its own 5-year conversion clock for penalty-free access to the converted principal before 59½; bracket-filling, IRMAA, state tax and the pro-rata rule are not modelled.

Roth value at withdrawal (tax-free)

Roth value at withdrawal (tax-free) from the formula above. Each converted amount has its own 5-year conversion clock for penalty-free access to the converted principal before 59½; bracket-filling, IRMAA, state tax and the pro-rata rule are not modelled.

Traditional value after retirement tax

Traditional value after retirement tax from the formula above. Each converted amount has its own 5-year conversion clock for penalty-free access to the converted principal before 59½; bracket-filling, IRMAA, state tax and the pro-rata rule are not modelled.

Net advantage of converting (after growing today's tax cost)

Net advantage of converting (after growing today's tax cost) from the formula above. Each converted amount has its own 5-year conversion clock for penalty-free access to the converted principal before 59½; bracket-filling, IRMAA, state tax and the pro-rata rule are not modelled.

Frequently asked questions