findquickanswers.com
  • Finance
    Credit Repair Companies and How They Work
  • Finance
    Credit Repair Companies: The Pros and Cons
  • Credit Cards
    The Hawaiian Airlines® World Elite MasterCard®
  • Health
    • Eating Disorder Treatment as an Inpatient Vs. an Outpatient

      Eating Disorder Treatment as an Inpatient Vs. an Outpatient

    • 11 Reasons Why Fat Shaming Affects Our Health

      11 Reasons Why Fat Shaming Affects Our Health

    • 5 Menopause Signs to Look Out For

      5 Menopause Signs to Look Out For

    • Hernia Treatment Options

      Hernia Treatment Options

    • Information on Multiple Myeloma

      Information on Multiple Myeloma

    • Cholesterol
      • Cholesterol Medications

        Cholesterol Medications

    • Diabetes
      • Shots

        Shots

      • Facts

        Facts

      • Diabetes and

        Diabetes and

      • Resistance

        Resistance

      • Pumps

        Pumps

    • Digestive Disorders
      • Laxative for Opiate Constipation

        Laxative for Opiate Constipation

      • Chronic Constipation Drugs

        Chronic Constipation Drugs

      • Chronic Constipation Disease

        Chronic Constipation Disease

      • Treatment Chronic Constipation

        Treatment Chronic Constipation

      • IBS Treatment Centre

        IBS Treatment Centre

    • Insurance
      • Benefits of Insurance for Military and Family

        Benefits of Insurance for Military and Family

      • How to Get the Best Rates on Term Life Insurance

        How to Get the Best Rates on Term Life Insurance

      • Should You Get Travel Medical Insurance?

        Should You Get Travel Medical Insurance?

      • Can your Bad Credit Affect your Auto Insurance

        Can your Bad Credit Affect your Auto Insurance

      • How to Compare Term Life Insurance Policies

        How to Compare Term Life Insurance Policies

    • Pain Relief
      • 6 Natural Rheumatoid Arthritis Treatments for Flare-Ups

        6 Natural Rheumatoid Arthritis Treatments for Flare-Ups

      • Irritable Bowel Syndrome Abdominal Pain: What it Means

        Irritable Bowel Syndrome Abdominal Pain: What it Means

      • 5 Best Ways to Cope with Ulcerative Colitis

        5 Best Ways to Cope with Ulcerative Colitis

      • Shingles Pain Relief

        Shingles Pain Relief

      • Treatment of Rheumatoid Arthritis Hand Pain

        Treatment of Rheumatoid Arthritis Hand Pain

    • Fitness
      • What You Should Know Before Buying A Treadmill

        What You Should Know Before Buying A Treadmill

    • Personal Care
      • What You Can Use Instead Of Deodorant

        What You Can Use Instead Of Deodorant

  • Finance
    • 5 Things You Should Know About Secured Credit Cards

      5 Things You Should Know About Secured Credit Cards

    • Overview on Credit Repair

      Overview on Credit Repair

    • PNC Points Visa

      PNC Points Visa

    • Secured Credit Cards: An Overview

      Secured Credit Cards: An Overview

    • Club Carlson℠ Premier Rewards Visa Signature® Card

      Club Carlson℠ Premier Rewards Visa Signature® Card

    • Credit Cards
      • 5 Things You Should Know About Secured Credit Cards

        5 Things You Should Know About Secured Credit Cards

      • Virgin Atlantic Black Card

        Virgin Atlantic Black Card

      • Secured Credit Cards: An Overview

        Secured Credit Cards: An Overview

      • British Airways Visa Signature® Card

        British Airways Visa Signature® Card

      • When to Consolidate Your Credit Cards

        When to Consolidate Your Credit Cards

    • Cash Advances
      • What are the Pros and Cons of Merchant Cash Advances?

        What are the Pros and Cons of Merchant Cash Advances?

      • Pros and Cons of Taking Out an Installment Loan

        Pros and Cons of Taking Out an Installment Loan

    • Business Loans
      • What are the Pros and Cons of Merchant Cash Advances?

        What are the Pros and Cons of Merchant Cash Advances?

      • 5 Things You Should Know Before Getting Consolidation Loans

        5 Things You Should Know Before Getting Consolidation Loans

    • Loans
      • How Payday Loans Work and What They Cost

        How Payday Loans Work and What They Cost

      • What You Should Know Before Getting a Car Title Loan

        What You Should Know Before Getting a Car Title Loan

      • Pros and Cons of Taking Out an Installment Loan

        Pros and Cons of Taking Out an Installment Loan

    • Retirement
      • The Difference between a Regular Savings Account and an IRA…

        The Difference between a Regular Savings Account and an IRA…

      • How You Can Use Mutual Funds for Retirement

        How You Can Use Mutual Funds for Retirement

      • 8 Tips for a Secure Retired Life

        8 Tips for a Secure Retired Life

      • How Your Roth IRA Could Be Your Emergency Fund

        How Your Roth IRA Could Be Your Emergency Fund

  • Auto
    • Selling Your Car Privately: Pros and Cons

      Selling Your Car Privately: Pros and Cons

    • Look Out for These Problems Before Buying a Used Car

      Look Out for These Problems Before Buying a Used Car

    • How to Choose Tires for Trucks

      How to Choose Tires for Trucks

    • Electric or Hybrid Car: Pros & Cons

      Electric or Hybrid Car: Pros & Cons

    • Selling Your Used Car: A Guide

      Selling Your Used Car: A Guide

    • The 10 Best Hybrid Cars You Should Consider Buying

      The 10 Best Hybrid Cars You Should Consider Buying

  • Business
    • Small Business Credit Card Processing

      Small Business Credit Card Processing

    • Business Trip Language Translator Services

      Business Trip Language Translator Services

    • What’s the Difference Between a Language Translator and an Interpreter?

      What’s the Difference Between a Language Translator and an Interpreter?

    • Proven Tips For Flea Control

      Proven Tips For Flea Control

    • 6 Facts You Need to Know About Accident Lawyers

      6 Facts You Need to Know About Accident Lawyers

    • 5 Questions You Should Ask Your Accident Lawyer

      5 Questions You Should Ask Your Accident Lawyer

  • Medical
    • Become a Physician Assistant in the Military

      Become a Physician Assistant in the Military

    • Medication IBS Constipation

      Medication IBS Constipation

    • Advanced Breast Cancer Treatment

      Advanced Breast Cancer Treatment

    • Colorectal Cancer Medications Overview

      Colorectal Cancer Medications Overview

    • Myocardial Infarction Causes

      Myocardial Infarction Causes

    • Cancer
      • Advanced Breast Cancer Treatment

        Advanced Breast Cancer Treatment

      • HER2 Breast Cancer Treatments

        HER2 Breast Cancer Treatments

      • ER2 Breast Cancer Treatment

        ER2 Breast Cancer Treatment

      • Breast Cancer Treatments

        Breast Cancer Treatments

      • IBRANCE Palbociclib Breast Cancer Treatments

        IBRANCE Palbociclib Breast Cancer Treatments

    • Psychiatry
      • ADHD Treatment Options And Strategies

        ADHD Treatment Options And Strategies

      • Possible Schizophrenia Treatments and Drugs

        Possible Schizophrenia Treatments and Drugs

      • 10 Signs: Recognizing the Symptoms of Bipolar Disorder

        10 Signs: Recognizing the Symptoms of Bipolar Disorder

      • 7 ADHD Facts You Need to Know

        7 ADHD Facts You Need to Know

      • 5 Surprising Signs Of Depression

        5 Surprising Signs Of Depression

    • Dermatology
      • All About Psoriasis: From Plaque Psoriasis Treatments to Pustular

        All About Psoriasis: From Plaque Psoriasis Treatments to Pustular

      • Plaque Psoriasis Treatement

        Plaque Psoriasis Treatement

  • Tech
    • The Best Platforms for Custom Mobile App Development

      The Best Platforms for Custom Mobile App Development

    • Samsung Galaxy Note 10 New Smartphone

      Samsung Galaxy Note 10 New Smartphone

    • Top 6 Affordable Video Conferencing Solutions

      Top 6 Affordable Video Conferencing Solutions

    • 5 Ways to Improve Video Conferencing Solution

      5 Ways to Improve Video Conferencing Solution

    • Everything You Should Know About VoIP

      Everything You Should Know About VoIP

    • Games
      • Top 5 Addictive Games For Your Smartphone

        Top 5 Addictive Games For Your Smartphone

    • Phone Systems
      • How Switching to a VoIP Phone System Can Help You…

        How Switching to a VoIP Phone System Can Help You…

      • How a VoIP Phone System Could Help Your Small Business

        How a VoIP Phone System Could Help Your Small Business

      • Why 8×8 is the Best Small Business Phone Service

        Why 8×8 is the Best Small Business Phone Service

      • Top 5 Advantages of a Hosted PBX Phone System

        Top 5 Advantages of a Hosted PBX Phone System

      • Everything You Should Know About VoIP

        Everything You Should Know About VoIP

    • Smartphone
      • Top 5 Addictive Games For Your Smartphone

        Top 5 Addictive Games For Your Smartphone

      • 5 Ways To Transfer Money With Your Smartphone

        5 Ways To Transfer Money With Your Smartphone

    • Video Conferencing Solutions
      • Top 6 Affordable Video Conferencing Solutions

        Top 6 Affordable Video Conferencing Solutions

      • 5 Ways to Improve Video Conferencing Solution

        5 Ways to Improve Video Conferencing Solution

    • Internet
      • How a Hybrid Cloud Can Change Your Life and Workspace

        How a Hybrid Cloud Can Change Your Life and Workspace

      • Top 5 Tips for Email Marketing for Small Business

        Top 5 Tips for Email Marketing for Small Business

      • 5 Best Small Business Internet Providers

        5 Best Small Business Internet Providers

      • 5 Reasons Your Business Needs Strong Firewall Network Security

        5 Reasons Your Business Needs Strong Firewall Network Security

    • Security
      • 3 Best Home Security and Alarm Systems

        3 Best Home Security and Alarm Systems

      • 5 Reasons Your Business Needs Strong Firewall Network Security

        5 Reasons Your Business Needs Strong Firewall Network Security

      • 5 Things to Know Before Installing A Home Security System

        5 Things to Know Before Installing A Home Security System

  • Travel
    • Ways You Can Afford To Study Abroad

      Ways You Can Afford To Study Abroad

    • Translator Apps for Your Next Vacation

      Translator Apps for Your Next Vacation

    • Things to Know about Air Ambulance

      Things to Know about Air Ambulance

    • How to Maintain Your Air Conditioner

      How to Maintain Your Air Conditioner

    • 10 Signs of a Possible Travel Scam

      10 Signs of a Possible Travel Scam

    • 6 Great Stargazing Places In The US

      6 Great Stargazing Places In The US

Should you Apply for a 401k or an IRA Savings Account?

by Stephanie Donnely

When it comes to saving for retirement, you want to make the best decisions possible. The worst possible scenario is to end up needing more money after you’ve already retired. Should you take advantage of your 401k or should you invest in an IRA? To better understand these terms, we’ll explain what they are and the pros and cons of each.

What is an IRA?

An Individual Retirement Arrangement (IRA) is an account that allows you to save money for retirement. This money will only be available to you six months after your 59th birthday. There are different types of IRAs including Traditional, Roth, and Rollover.

What are the pros of an IRA?

  • Tax deductions:
    As you add money to your IRA account, you can use the invested funds as a tax deduction up to $5,000.
  • Availability:
    You don’t need to open an IRA account through your employer. You can open one whenever you want, as long as you meet the minimum income requirements.
  • Flexibility:
    Most investors love the amount of flexibility that is offered with IRA accounts because you have the ability to tweak your allocation if the account is under-performing.

What are the cons of an IRA?

  • Limited contributions:
    Similarly to a 401k, you can only contribute up to a certain amount per year with an IRA. However, this amount is also much lower than the 401k limitations as the maximum is set at just $5,000 per year.
  • Early withdrawal penalties:
    If you have to withdraw money from your IRA before you are 59 1/2, then you’ll face penalties. After you are charged income tax (for Traditional IRAs), you’ll also be charged an extra 10%.
  • Required withdrawal:
    If you have a Traditional IRA, you will be forced to begin withdrawing money six months after your 70th birthday, whether you are retired or not.

What is a 401k?

A 401k is a retirement savings plan that is created through your employer. Part of your paycheck will be funneled into the account before taxes are taken out. Often, companies will “match” what the employee pays as an incentive to contribute, although this is not required.

What are the pros of a 401k?

  • Employer matching:
    Unlike an IRA, your employer may contribute to your 401k as it grows. While it’s not required, it’s a popular benefit that is offered by many businesses.
  • Minimal effort:
    A 401k grows without much effort on your part. Your contributions are taken directly from your paycheck without you having to make additional steps to invest.
  • High contribution limit:
    The limit on 401k contributions is extremely high – it is usually $18,000, but it may be as high as $24,000 if you’re over 50 years of age.

What are the cons of a 401k?

  • Account fees:
    You may be charged fees to keep the account open, and since the account is through your employer, you will have little control over the service you receive.
  • Taxes:
    Since the money contributed to a 401k is pre-tax, this means that once you pull the money out, you’ll have to pay taxes on the funds as though it is income tax.
  • Waiting period:
    Some employers may require you to wait through a probation period (which is usually six months) before you are able to invest in a 401k.

Photo: Thinkstock/© KaraGrubis

Posted on February 15, 2023
Privacy Policy | Terms Of Use | Contact