401(k) vs Roth IRA 2026: Which Is Better for Your Retirement?
401(k) vs Roth IRA 2026: Which Is Better for Your Retirement? 401(k) vs Roth IRA — two of the most powerful retirement accounts in America. One gives you a tax break now, the other gives you tax-free money in retirement. This guide compares them side by side, 2026 limits, and tells you which to prioritize. What Is a 401(k)? Employer-sponsored retirement plan. Contributions come out of your paycheck pre-tax (Traditional) or after-tax (Roth 401k). Many employers match contributions (free money). Higher contribution limits. Investment options chosen by employer. Withdrawals taxed (Traditional) or tax-free (Roth). What Is an IRA? Individual Retirement Account you open yourself (Fidelity, Vanguard, Schwab). Two types: Traditional IRA: Pre-tax contributions (tax-deductible), withdrawals taxed. Roth IRA: After-tax contributions, withdrawals tax-free in retirement. More investment choices than 401k. Lower contribution limits. Key Differences (Side by Side) Tax treatment: 401k Traditi...