D 2021-05-19T19:57:47.300
L RetirementAccounts
N text/x-markdown
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U zie
W 1869
Retirement accounts are the special tax-advantaged accounts meant for retirement that are generally always better than a taxable brokerage account, but not always.
Normally your employer just makes 1 type available to you, and you have little to no choice. Usually the choices you get are:
1) pre-tax (traditional) or post-tax (ROTH) contributions
2) 1 or maybe a few different vendors to choose from.
If you are self-employed or are otherwise responsible for your own retirement(for example 1099 workers), then you have more options available.
[This article](https://www.whitecoatinvestor.com/comparing-retirement-accounts/) does a pretty good job of explaining the many varieties.
Generally speaking you can usually safely ignore most all the details and focus on pre-tax/post-tax and putting in as much as you can. The other details usually don't matter, and worst-case the details just mean you have to pay a bit more taxes, not the end of the world. The details usually only matter if you are approaching the max contribution limits(which are usually $19,500/yr).
You want pre-tax contributions if you think you will pay less taxes in retirement, and this is generally true for the vast majority of people, so pre-tax contributions are a great default.
You want post-tax contributions if you will pay the same or more taxes in retirement. This is usually only true for people with Pensions or people with LOTS of tax-advantaged account savings(over $2million USD) and huge RMD's.
That said, a ROTH-IRA is generally always available on top of whatever other retirement account you can get, and you should try to max that out if you can(2021 limit of $6k per year -- some additional ways exist to make this # effectively unlimited but are complicated and not always available, research "mega back-door roth" if you have loads of $$$'s).
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