Two men are sitting on chairs on a beach with drinks in their hands.

Which account types should you use to save?

Employer plans, IRAs, and taxable accounts can all be used for retirement saving. Here are some suggestions that may help you reach your retirement savings goals.
5 minute read

1. Save up to the match in your employer plan

If your employer offers a retirement plan (like a 401(k) or 403(b) plan) and will match your contributions up to a certain percentage, make sure you get the full amount of free money that's available to you.

2. Open an IRA

It's great if you can save more than what's needed to get the maximum company match in your employer plan.

Opening an IRA for your additional savings will give you a chance to shop around. You can hold many types of investments in an IRA, including any mutual fund, ETF, stock, or bond—many of which might cost less than those offered through your employer plan.

And you can use a Roth IRA to save money that won't be subject to taxes in retirement—an option that isn't available in many employer plans.

The 2024 annual contribution limit for IRAs is $7,000 for most people, although it depends on your income. (If you're age 50 or over, you can contribute up to $8,000.)

Find out more about IRAs


If you have an employer-sponsored plan from a previous job, rolling it over to an IRA can give you additional flexibility and make your portfolio easier to manage.

See whether a rollover could be right for you

3. Max out your contributions to your employer plan

After you've saved up to the match in your employer plan and maxed out your IRA, go back to your employer plan. The 2024 annual limit for employee contributions is $23,000 ($30,500 if you're age 50 or older and your plan allows catch-up contributions.)

4. Continue saving in a taxable account

For most people who want to save even more, the next step is to save in a general investment account.

These accounts won't have the tax breaks associated with retirement accounts, so you'll have to pay investment taxes on interest, dividends, and capital gains as your account grows, and you won't receive any tax deductions for your contributions.

Open a retirement account

We offer several types of accounts you can use to save for retirement. Figure out which one is right for you.

Find the right retirement account for you

Get your retirement plan

Where does retirement fit into your priorities?

See how to juggle multiple financial goals


How much can you contribute?

See contribution limits for various types of retirement plans

Explore professional advice

We offer expert help at the low cost you'd expect from Vanguard.

We're here to help

Talk with one of our investment specialists

Monday through Friday
8 a.m. to 8 p.m., Eastern time

We're here to help

Talk with one of our investment specialists

Monday through Friday
8 a.m. to 8 p.m., Eastern time

All investing is subject to risk, including the possible loss of the money you invest.

When taking IRA or employer plan withdrawals before age 59½, you may have to pay ordinary income tax plus a 10% federal penalty tax.

Neither Vanguard nor its financial advisors provide tax and/or legal advice. This information is general and educational in nature and should not be considered tax and/or legal advice. We recommend you consult a tax and/or legal adviser about your individual situation. 

For more information about Vanguard funds or ETFs, visit to obtain a prospectus or, if available, a summary prospectus. Investment objectives, risks, charges, expenses, and other important information about a fund are contained in the prospectus; read and consider it carefully before investing. 

Vanguard's advice services are provided by Vanguard Advisers, Inc. ("VAI"), a registered investment advisor, or by Vanguard National Trust Company ("VNTC"), a federally chartered, limited-purpose trust company.

The services provided to clients will vary based upon the service selected, including management, fees, eligibility, and access to an advisor. Find VAI's Form CRS and each program's advisory brochure here for an overview.

VAI and VNTC are subsidiaries of The Vanguard Group, Inc., and affiliates of Vanguard Marketing Corporation. Neither VAI, VNTC, nor its affiliates guarantee profits or protection from losses.