What Is an AFT Calculator?
An Adjusted Federal Tax (AFT) calculator converts the nominal balance of a pre-tax retirement account into its true after-tax spendable value. Because Traditional 401(k) and IRA accounts are taxed upon withdrawal, a $500,000 balance is not actually $500,000 in your pocket — the government takes its share at your marginal tax rate when you withdraw.
By contrast, Roth accounts are funded with after-tax dollars, so qualified withdrawals in retirement are 100% tax-free. The AFT calculator lets you compare apples to apples by showing the true after-tax value of each account type.
How the AFT Formula Works
Traditional After-Tax Value:
AFT = Balance × (1 − Retirement Tax Rate)
Roth After-Tax Value:
AFT = Balance (no additional tax)
Break-Even:
Traditional wins if Current Rate > Retirement Rate
Roth wins if Retirement Rate > Current Rate
Traditional vs Roth Comparison
| Feature | Traditional | Roth |
|---|---|---|
| Tax on contributions | None (pre-tax) | Yes (after-tax) |
| Tax on withdrawals | Yes (ordinary income) | No (qualified) |
| Required Minimum Distributions | Yes at age 73 | No (Roth IRA) |
| Best when | Tax rate drops in retirement | Tax rate rises in retirement |