Top Retirement Savings Plans

1. 401(k) Plans

A 401(k) plan is a retirement savings account sponsored by an employer. Employees can contribute a portion of their salary to the plan on a pre-tax basis. Many employers also offer a matching contribution, which can help boost your savings even more.

Benefits of a 401(k) Plan:

• Pre-tax contributions
• Employer matching contributions
• Tax-deferred growth

2. Individual Retirement Accounts (IRAs)

IRAs are retirement savings accounts that individuals can open on their own. There are two main types of IRAs: Traditional IRAs and Roth IRAs. Traditional IRAs offer tax-deferred growth, while Roth IRAs offer tax-free withdrawals in retirement.

Benefits of IRAs:

• Tax advantages
• Wide range of investment options
• No required minimum distributions (Roth IRAs)

3. Simplified Employee Pension (SEP) IRA

A SEP IRA is a retirement plan for self-employed individuals and small business owners. Contributions to a SEP IRA are tax-deductible and can be made by the employer on behalf of the employee.

Benefits of a SEP IRA:

• High contribution limits
• Flexible contribution amounts
• Easy to set up and maintain

4. 403(b) Plans

403(b) plans are retirement savings accounts offered to employees of certain tax-exempt organizations, such as schools and non-profit organizations. Contributions to a 403(b) plan are made on a pre-tax basis, similar to a 401(k) plan.

Benefits of a 403(b) Plan:

• Pre-tax contributions
• Employer matching contributions (if offered)
• Tax-deferred growth

5. Thrift Savings Plan (TSP)

The Thrift Savings Plan is a retirement savings plan for federal employees and members of the uniformed services. It offers similar benefits to a 401(k) plan, including pre-tax contributions and employer matching contributions.

Benefits of a TSP:

• Low fees
• Employer matching contributions
• Multiple investment options