Retirement

Retirement accounts like 401k's and IRAs are designed to help you save for retirement with some tax advantages. 

A 401k is offered by many employers and allows you to put a portion of your paycheck into the account before taxes are taken out. This means you reduce your taxable income now, and the money grows tax-deferred until you withdraw it in retirement. Some employers even match a portion of your contributions, which is essentially free money. 

An IRA, or Individual Retirement Account, is another way to save for retirement, and you can open one on your own, regardless of your employer. There are two main types: Traditional IRAs and Roth IRAs. With a Traditional IRA, your contributions may be tax-deductible, and the money grows tax-deferred until retirement. With a Roth IRA, you contribute money that’s already been taxed, but your withdrawals in retirement are tax-free, provided certain conditions are met. These investments also scale over time.

Both accounts are useful for building a retirement safety net, and choosing between them often depends on your current tax situation and your expectations for the future.