Which is better, Roth or traditional?

Traditional wins if your tax rate falls in retirement; Roth wins if it rises. Splitting hedges the bet.

What does traditional save me today?

Your combined federal and state top rate times the contribution. The playbook calculates it for you.

Money Playbook · Updated 2026-10-02

Roth vs Traditional 401(k) in South Dakota: the money playbook

On $75k in South Dakota, if you choose Roth or traditional your take-home pay rises by about $2,200 a year. 5-year simulator, scorecard, salary table and checklist.

Scenario simulator

Salary: $75,000Your monthly cost change: $0Years: 5

Roth: $10k after tax

Traditional: $10k pre-tax

$2,200

Change per year

+$2,200

If the yearly difference is invested at 5%, after 5 years: $12,156

Traditional saves $2,200 of tax today on a $10,000 contribution. Roth wins if your tax rate in retirement will be higher than today's 22.0%.

Decision scorecard

Tax impact (auto from simulator)4/5

Expect higher income later in my career3/5Expect to retire in a higher-tax state3/5Want tax-free money in retirement3/5Need the tax break today3/5Already have big pre-tax balances3/5

Leaning yes — close the gaps first

Rate each factor honestly. The score is yours alone and isn't saved.

By salary level

Salary	Roth: $10k after tax	Traditional: $10k pre-tax	Difference
$40,000	$0	$1,200	$1,200
$60,000	$0	$1,200	$1,200
$75,000	$0	$2,200	$2,200
$100,000	$0	$2,200	$2,200
$150,000	$0	$2,400	$2,400
$200,000	$0	$2,400	$2,400

Printable checklist

Find your current combined top tax rate (shown above)
Estimate your retirement income and state
Split contributions if you're unsure
Check whether your employer match goes into a pre-tax account
Revisit the choice after every big raise

Questions

Which is better, Roth or traditional?: Traditional wins if your tax rate falls in retirement; Roth wins if it rises. Splitting hedges the bet.
What does traditional save me today?: Your combined federal and state top rate times the contribution. The playbook calculates it for you.

Method and sources

Figures come from the same engine as our paycheck calculators: 2026 federal brackets and standard deduction, 2026 FICA, and 2025–2026 resident state schedules. City and county taxes, credits other than the Child Tax Credit, and nonresident rules are not modeled. Educational estimate, not tax advice.