Compare
| Account | Tax Benefit | 2026 Limit | Best For |
|---|---|---|---|
| 401(k) | Pre-tax contributions, tax-deferred growth | $24,500 | Employer match + high income |
| Roth 401(k) | After-tax contributions, tax-free growth & withdrawals | $24,500 | Expect higher tax rate in retirement |
| Traditional IRA | Pre-tax deduction (if eligible), tax-deferred growth | $7,500 | No employer plan available |
| Roth IRA | After-tax, tax-free growth & withdrawals forever | $7,500 | Young, lower income now |
| HSA | Pre-tax in, tax-free growth, tax-free medical withdrawals | $4,400 (self-only) / $8,750 (family) | Triple tax advantage — the best account in the tax code |
Key point
An employer 401(k) match is a 50–100% instant return on your contribution. If your employer matches 50% up to 6% of salary, contributing 6% means getting 3% for free. Not contributing enough to get the full match is leaving money on the table.
Formula
Match Value = Salary × Your Contribution % × Match Rate
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Key insight
Note
Roth IRA income phaseout (2026): Direct Roth IRA contributions begin phasing out at ~$153,000 MAGI for single filers and ~$242,000 for married-filing-jointly. Above ~$168,000 (single) / ~$252,000 (married), direct contributions are no longer allowed. Once you cross the phaseout threshold, the Roth IRA disappears from your options — unless you use the backdoor mechanics. If you are near or above these thresholds, see pf-10 for how the backdoor Roth works.
SECURE 2.0 enhanced catch-up (ages 60-63): Starting in 2025, savers aged 60-63 may make an enhanced catch-up contribution to employer plans — up to $11,250 on top of the standard $24,500 limit, for a total of $35,750. The standard catch-up for ages 50-59 and 64+ remains $8,000. This provision (SECURE 2.0 Act §109) is less relevant for recent grads.
Sit with the ideas.
An investor puts $500/month into a taxable brokerage account but only contributes 1% to a 401(k) with a 100% match up to 5% on a $80,000 salary. What's the highest-priority change?