Roth IRA vs. 401(k): Which Should You Choose?

The Roth IRA and 401K are two popular retirement accounts.

What's the Difference?

The Roth IRA is managed through a brokerage company. And the 401k is managed through your employer.

401k match

The 401k is often matched up to a specific contribution by your employer. That's free money.

Withdrawal rules

You'll face a penalty for withdrawing money from both accounts but the Roth IRA comes with a list of reasons to withdraw money without the fee.

Should you choose one or the other.

The answer depends. It's best to maximize contributions you would receive from your employer. But that does usually come with a wait period called vesting.

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