About this tool
A Roth conversion moves money from a Traditional IRA (taxable on withdrawal) to a Roth IRA (tax-free on withdrawal) by paying tax on the converted amount today. It makes sense when you expect higher tax rates in retirement, want to avoid required minimum distributions, or want tax diversification.
How it works
Enter the amount to convert, your current tax rate, expected retirement tax rate, time horizon, and return rate. The calculator compares: leaving the money in Traditional vs converting to Roth (paying tax now).
The math of compound growth
Compounding is the engine of every long-term investment plan. The formula for monthly contributions:
FV = PMT x ((1+r)^n - 1) / r
where PMT = monthly contribution, r = monthly return rate, n = months. With a one-time lump sum P at the start: FV += P x (1+r)^n.
Why starting early matters more than contributing more
Saving $500/month from age 25 to 65 (40 years) at 8% reaches ~$1.75M. Same $500/month starting at 35 reaches only ~$745K. The 10 extra years more than DOUBLES the final balance - that's the difference between compounding for 30 vs 40 years.
The first $100K is the hardest
Charlie Munger's observation: getting to $100K is brutal because you depend on contributions, not returns. After $100K, returns start to do more work than your savings. After $1M, your annual return often exceeds your annual contribution.
Tax-advantaged account types by country
| Country | Pre-tax (defer) | After-tax (Roth-style) | Annual limit (2026) |
|---|---|---|---|
| US | 401(k), Traditional IRA, HSA | Roth IRA, Roth 401(k) | $23,500 401(k) / $7,000 IRA / $4,300 HSA |
| UK | Workplace pension, SIPP | ISA (Stocks/Cash/LISA) | £60,000 pension annual / £20,000 ISA |
| Canada | RRSP, FHSA | TFSA | 18% income RRSP / $7,000 TFSA / $8,000 FHSA |
| Australia | Super (concessional) | Super (non-concessional) | AUD 30,000 concessional / AUD 120,000 non-conc |
| India | EPF, NPS, PPF | Equity LTCG (limited) | Rs 1.5L 80C / Rs 50K NPS / Rs 1.5L PPF |
| Singapore | SRS | CPF top-ups | SGD 15,300 SRS (Singaporean) / 35,700 (foreigner) |
| Germany | Riester, Rürup, bAV | Few options | EUR 29,344 Rürup max |
The four investment principles
- Asset allocation > stock picking: 90%+ of long-term return variance comes from your stocks/bonds/cash split, not from which specific stocks. Low-cost index funds beat 80%+ of active managers over 10+ years.
- Costs compound too: a 1% annual fund fee compounds to ~25% of total return over 30 years. Prefer index funds with TER under 0.20%.
- Time in market beats timing: missing the 10 best days in the market drops a 30-year return from ~9% annualized to ~5%. Those days cluster near crashes - selling in fear locks in losses.
- Inflation eats nominal returns: 7% nominal return at 3% inflation is 4% real return. "Safe" cash at 1% loses ~2% real per year. Real returns matter.
Glide path: how allocation should change with age
The classic rule "100 minus your age in stocks" is too conservative for modern lifespans. Updated guidance:
| Age | Equity % | Bonds % | Cash % |
|---|---|---|---|
| 25-35 | 90-100% | 0-10% | 0% |
| 35-45 | 80-90% | 10-20% | 0% |
| 45-55 | 70-80% | 15-25% | 5% |
| 55-65 | 55-70% | 25-35% | 5-10% |
| 65+ (retired) | 40-60% | 30-50% | 10% |
If you retire at 65 and live to 90, your retirement portfolio still has 25-year horizon. Too conservative an allocation runs out of money. Too aggressive risks sequence-of-returns disasters early in retirement.
The formula explained
This calculator uses the following formula:
Roth net = (amount × growth_factor); Traditional net = (amount × growth_factor) × (1 - retirement_tax)
The reason this formula works is rooted in the underlying physics, finance, or biology of the problem. Behind every calculator is a published, peer-reviewed equation or a widely accepted convention. We do not invent formulas; we apply standard ones from textbooks, government tables, professional bodies, and academic literature.
If you are curious about the math, the simplest way to verify is to plug in two known numbers and compare against a known result. The calculator should match published examples to within rounding precision.
Frequently asked questions
When does Roth conversion win?
When future tax rate is equal or higher than today's. Even with same rate, Roth wins by avoiding RMDs and giving heirs tax-free inheritance.
What's the 5-year rule?
Each conversion has its own 5-year clock for penalty-free withdrawal of converted principal. Multiple conversions = multiple clocks.
Can I undo a conversion?
No - recharacterizations were eliminated in 2018. Once converted, it's permanent.
Backdoor Roth?
Different - that's a non-deductible Traditional contribution converted same year. Useful when over Roth income limits.
How much do I need to retire?
The 4% rule: you can withdraw ~4% of your portfolio annually with high confidence of lasting 30+ years. So if you need $50K/year, target $1.25M. The rule was developed for 30-year retirements in the US - for 40+ years (early retirement) use 3-3.5%.
Is the stock market too risky for me?
Over 1-year periods: very volatile, ~30% historical loss possible. Over 10-year periods: 95% positive historically. Over 30-year periods: 100% positive in any rolling US window. Risk depends on time horizon, not the asset class itself.
Should I pay off the mortgage or invest?
Compare your mortgage rate to expected investment return. If mortgage rate is below 5% and your retirement contributions are maxed, investing usually wins long term. Above 7%, the guaranteed return from paying off the mortgage often wins.
How much should I save each month?
Rough target: 15-20% of gross income toward retirement, starting at 25. If you start at 35, you need 25-30%. At 45, 40%+. Saving rate matters more than investment selection for the first 10-15 years.
What's the safest investment?
Short-term government bonds in your home currency. Inflation-linked bonds (TIPS US, ILBI India, index-linked gilts UK) protect against inflation. Bank savings accounts up to insured limits ($250K US FDIC, £85K UK FSCS) are also safe but lose to inflation.
How accurate is the Roth Conversion Calculator?
It applies the standard formula. Accuracy is limited only by your input precision. For decisions with material consequences (taxes, medical, legal, structural), use the result as a starting point and verify with a qualified professional in the relevant field.
Is the Roth Conversion Calculator free to use?
Yes. 100% free, no signup, no payment, no API key. The site is funded by display ads around the tool but not inside the calculation flow.
Are my inputs saved anywhere?
No. All inputs stay in your browser tab. Closing the tab discards them. The site uses Google Analytics for traffic measurement (anonymized) but the analytics never see what you type into the form.
Can I use the Roth Conversion Calculator on my phone?
Yes. The tool is responsive and tested on iOS Safari, Android Chrome, and major desktop browsers. Touch targets meet Apple's 44pt and Google's 48dp minimum.
Does the Roth Conversion Calculator work offline?
Yes. Once the page has loaded, it works without internet. The calculation runs in JavaScript on your device.
How do I report a bug or suggest improvement to the Roth Conversion Calculator?
Email hi@3tej.com with the URL of this page and a description of what you saw vs expected. We typically respond within 72 hours.
Can I share results from the Roth Conversion Calculator?
Take a screenshot or copy the output. The page doesn't generate shareable URLs for specific calculations - inputs stay in your browser only.
Why are the results different from another roth conversion tool?
Most likely: different formula assumptions, different default values, different rounding rules, or different applicable rates. Check the methodology if both tools document it. Both can be valid for different scenarios.