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401(k) Or Roth Ira

WHICH HAS PRIORITY? MY 401(K) OR ROTH IRA?

Question: I'm 28, married and I recently started a new job. I contribute 10% to my 401(k) and my employer matches the first 4%. I also contribute to a Roth IRA. If I'm only able to fund one retirement plan, or if I wanted to think of one as being a higher priority than the other, which plan should it be? - Ryan Bergan, St. Paul, Minn.
Ref. https://money.cnn.com/2007/01/03/pf/expert/...eymag/index.htm

Ira Roth k

Anytime you have a matching contribution, thats free money and you should consider that first priority. Roth IRA's are great, but they don't match free money from your company. Now, I believe that Roth IRA's traditionally yield more money with a higher percentage of interest, but free money is free money.

401(k) Or Roth Ira History & Civil Business Politics

The article gave a strategy that I followed as I started saving for retirement. I first contributed to my company's 401K (to the point of matching funds). Then I opened a IRA and eventually added annually to the maximum there as well. When I had more money left to save, I then returned to the company's 401K and eventually maximized my investment there as well.

The IRA does have a huge benefit in that the proceeds you get from the investment are not taxable when you withdraw them, as long as you meet the requirements. The interest that you make off the investments usually far outweighs what you initially put into them, so it is a pretty sweet deal.

My company matches the first 5% of my contribution at 50%. It is not as good as some companies, but it is still free money and free money is pretty hard to beat.

Ira Roth k

401(K)S AND IRAS ARE NOT ENOUGH

Question: I'm 32 years old and maxing out my 401(k) and my Roth IRA. I have another $1,200 a month that I'm putting into a savings account that already has about four months worth of emergency money and that pays only 4.5 percent. I'm not familiar with stocks and have limited knowledge of funds, but I'm wondering whether I can do better than the savings account for that extra $1,200 a month. Any suggestions? -Norm, Dumfries, Virginia
Ref. money.cnn.com/2007/03/29/pf/expert/expert.moneymag/index.htm