If you have an employer that matches your contributions, this is your first choice for retirement savings; if not, it’s still a great way to save. 401(k)s are like the big brother to IRAs. All the great tax advantages that IRAs have also apply to 401(k)s except that the contribution limit is higher - $19,500 of employee contributions for 2020 with an additional $6,500 allowed in catch-up contributions if you’re over 50. Unlike IRAs, there are no income limits to either Traditional or Roth contributions, and employers can make contributions to the account as well.
