Retirement Accounts Explained: 401(k), IRA, Roth, HSA and More

The US has a handful of tax-advantaged accounts built for retirement. They differ in three ways: who can open them, when you pay tax, and when you can reach the money.

The main accounts at a glance

Account	Who can use it	Tax break	Penalty-free access
401(k)	Employees of companies that offer it	Pre-tax or Roth	59½, or 55 under the Rule of 55
403(b)	Public schools, hospitals, nonprofits	Pre-tax or Roth	Same as 401(k)
Governmental 457(b)	State and local government employees	Pre-tax or Roth	After leaving that employer, at any age
Traditional IRA	Anyone with earned income	Often deductible	59½
Roth IRA	Earned income, under income limits	Tax-free growth and withdrawals	Contributions any time; earnings at 59½ after 5 years
SEP IRA	Self-employed and small businesses	Pre-tax	59½
Solo 401(k)	Self-employed with no employees	Pre-tax or Roth	59½
HSA	People with a high-deductible health plan	Deductible, tax-free growth and medical withdrawals	Medical: any time. Other: 65

Contribution limits change most years; the IRS publishes them each fall.

Pre-tax or Roth?

Most accounts come in two tax flavours. Pre-tax (traditional) lowers your taxes now; you pay income tax on withdrawals. Roth is funded with taxed money; qualified withdrawals are tax-free. Our guide to Roth vs traditional 401(k) walks through how to choose.

A common order to fill them

401(k) up to the full employer match. It’s free money: check yours with the 401(k) match calculator.
HSA, if you have an eligible health plan.
Roth IRA, if you’re under the income limit.
Back to the 401(k), up to the yearly limit.
Taxable brokerage account for anything beyond.

Self-employed? A Solo 401(k) or SEP IRA takes the place of the workplace plan.

Required minimum distributions

Traditional 401(k)s and IRAs must start paying out at 73 for people born from 1951 to 1959, and at 75 for those born in 1960 or later. Roth IRAs and Roth 401(k)s have no required distributions for the original owner.

What it all adds up to

The account type decides your taxes; your monthly contributions decide your outcome. See what yours grow to by retirement, in today’s dollars, with the retirement savings calculator.

Retiring before 59½? Holding some money in a taxable account and a Roth IRA gives you money you can reach early. See how to retire at 55.

Run your own numbers

$1.07M at 65

At a 4% withdrawal rate that pays $42,736 a year, about $3,561 a month, in today's dollars.

You put in: $470,000
Growth adds: $598,409
Yearly income: $42,736

What would change your result

Invest $250 more a month and you'd have $1.29M at 65, $219,674 more.
Working until 67 raises it to $1.18M, about $47,116 a year of income.
Waiting five years to start investing would leave you $206,957 short.

What-ifs worked out from your own numbers. Not personal financial advice.

Portfolio
You put in

Using a 3.88% real return. All amounts in today's dollars.

Year-by-year table

Age	Portfolio	You put in
30	$50,000	$50,000
31	$64,154	$62,000
32	$78,857	$74,000
33	$94,132	$86,000
34	$110,000	$98,000
35	$126,484	$110,000
36	$143,608	$122,000
37	$161,397	$134,000
38	$179,877	$146,000
39	$199,074	$158,000
40	$219,018	$170,000
41	$239,735	$182,000
42	$261,258	$194,000
43	$283,616	$206,000
44	$306,842	$218,000
45	$330,970	$230,000
46	$356,036	$242,000
47	$382,074	$254,000
48	$409,124	$266,000
49	$437,225	$278,000
50	$466,416	$290,000
51	$496,742	$302,000
52	$528,245	$314,000
53	$560,971	$326,000
54	$594,969	$338,000
55	$630,286	$350,000
56	$666,976	$362,000
57	$705,090	$374,000
58	$744,684	$386,000
59	$785,816	$398,000
60	$828,545	$410,000
61	$872,934	$422,000
62	$919,046	$434,000
63	$966,950	$446,000
64	$1,016,713	$458,000
65	$1,068,409	$470,000

Quick answers

What is the best retirement account?

For most employees, the 401(k) up to the employer match comes first, because the match is an instant return. After that, a Roth IRA, an HSA if you're eligible, and more 401(k) contributions are common next steps.

Can I have a 401(k) and an IRA at the same time?

Yes. You can contribute to both in the same year. Having a workplace plan can limit whether your traditional IRA contribution is tax-deductible, depending on your income.

Is an HSA a retirement account?

Not officially, but it works like one. Contributions are tax-deductible, growth is tax-free, and withdrawals for medical costs are tax-free at any age. After 65, other withdrawals are taxed like a traditional IRA without a penalty.