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Truth Tip: Comparing Taxable vs. Tax-Deferred Accounts

We received this excellent question from a Truth Concepts user this week:

Q. I am trying to do a comparison between using a qualified plan and a non-qualified plan.  I understand pretty well how to use the Qualified Plan calculator, however I want to show an “apples to apples comparison” assuming everything else is equal i.e. ROR, management fee, etc., but with the client paying taxes each year on their investment gains, so that at retirement the money they have to spend is tax free.

A. That will be easiest on the Accumulation Calculator.  I’ve made it easy because there is a “duplicate” button on the top left, so put your data in, push “tax deferred” on the right, then duplicate the calculator and push “taxable” on the right for the second one.

Great question!

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