A traditional 401(k) or 403(b) is generally the first stop for anyone with access to an employer match, since the match is free money regardless of anything else about the account. Contributions reduce your taxable income today, growth is tax-deferred, and withdrawals in retirement are taxed as ordinary income. For 2026, the employee contribution limit is $24,500, with an additional $8,000 catch-up for those 50 and older, and a $11,250 'super catch-up' for those 60 to 63. Required minimum distributions apply starting at 73 (moving to 75 for those born in 1960 or later).

A Traditional IRA works on the same pre-tax-in, taxable-out principle, but with a much smaller contribution ceiling, $7,500 for 2026, plus a $1,100 catch-up at 50+, and no employer match since it isn't tied to a job. Whether the contribution is actually tax-deductible depends on your income and whether you (or a spouse) are covered by a workplace retirement plan; above certain income levels with workplace coverage, the contribution becomes non-deductible, though it can still be made and later converted to a Roth.

A Roth IRA flips the tax treatment: contributions are made with after-tax dollars, and in exchange, qualified withdrawals, including all the growth, are entirely tax-free, with no required minimum distributions for the original owner during their lifetime. The tradeoff is a relatively low contribution limit (the same $7,500/$1,100 catch-up as a Traditional IRA, since the two share a combined limit) and an income phase-out: for 2026, the ability to contribute directly phases out between $153,000 and $168,000 of MAGI for single filers, and between $242,000 and $252,000 for married filing jointly. Above those levels, a 'backdoor Roth,' a non-deductible Traditional IRA contribution followed by a conversion, is the workaround most higher-income households use instead.

A Roth 401(k) combines the tax-free treatment of a Roth IRA with the much higher contribution limit of a 401(k), and critically, it has no income limit at all, making it available to high earners who are locked out of direct Roth IRA contributions. Employer matching contributions to a Roth 401(k) are still made on a pre-tax basis and taxed upon withdrawal, even though your own contributions are after-tax, so a Roth 401(k) balance typically contains both tax-free and taxable pieces. Since SECURE 2.0, Roth 401(k)s are no longer subject to required minimum distributions during the original owner's lifetime, matching Roth IRA treatment, a meaningful simplification that took effect for tax years beginning after 2023.

A Health Savings Account offers a tax structure none of the other four can match: contributions are deductible (or pre-tax through payroll), growth is tax-deferred, and withdrawals for qualified medical expenses are entirely tax-free, a genuine triple tax advantage. For 2026, the contribution limit is $4,400 for self-only coverage or $8,750 for family coverage, plus a $1,000 catch-up for those 55 and older. The tradeoff is eligibility: you must be enrolled in a qualifying high-deductible health plan to contribute, and once enrolled in Medicare, you can no longer contribute, though the account and its tax-free treatment for medical expenses continue indefinitely.

For business owners and the self-employed, SEP-IRAs, SIMPLE IRAs, and Solo 401(k)s offer substantially higher contribution ceilings than any of these five, since contributions can be made both as employer and employee. That's a separate comparison with its own set of tradeoffs, covered in more depth in the small-business owner-specific guidance linked below, rather than duplicated here.

The general prioritization order for most households: capture the full employer match in a 401(k) or 403(b) first, since it's an immediate, guaranteed return that nothing else can match. After that, the choice between Roth and traditional, in whichever account is available, comes down to whether you expect to be in a higher or lower tax bracket when you withdraw the money than you are today. If you're eligible, max the HSA as well, given its unmatched triple tax advantage, and treat it as a long-term investment account rather than a spending account for routine medical bills if your cash flow allows.

If your income is too high to contribute directly to a Roth IRA, the backdoor Roth is worth understanding and using rather than defaulting to a Traditional IRA contribution you don't actually need the deduction from. A Roth 401(k), where available, sidesteps the income limit question entirely and is worth strong consideration for higher earners who want Roth-style tax-free growth without the backdoor mechanics.

• Contributing to an IRA before capturing the full available employer 401(k) match, effectively leaving free money on the table.
• Assuming a Roth 401(k) is subject to RMDs the way it used to be. SECURE 2.0 eliminated RMDs for Roth 401(k)s during the original owner's lifetime starting with 2024.
• Not realizing a backdoor Roth is available once income is too high for a direct Roth IRA contribution, and defaulting to a Traditional IRA contribution instead.
• Treating an HSA as a pass-through spending account for medical bills rather than investing the balance for long-term, triple-tax-advantaged growth.
• Choosing Roth versus traditional contributions based on which feels simpler rather than an actual comparison of current versus expected future tax brackets.