6 Retirement Accounts Worth Considering, According to Experts

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For some, retirement seems like it’s a day far, far off into the future. But as fast as time goes by, the day you can quit your job could come much sooner than you think, and you’ll want to be prepared.

That means contributing toward a sizable nest egg now to carry you through your golden years later.

Here are six retirement accounts worth considering, according to experts.

Health Savings Account: Offers Triple Tax Advantages

“The No. 1 best retirement account is the health savings account — it’s the only one with triple tax advantages,” said Jeremy Keil, CFP(r), CFA, a retirement-focused financial advisor and host of both the “Retirement Revealed” podcast and “Mr. Retirement” YouTube channel. 

Keil said when you put money into an HSA you get a tax deduction, and it grows tax-deferred. Additionally, when you take money out for health expenses, it’s tax-free.

“Do your best to max out your HSA, and then let it grow by using other income or investments to pay your current health expenses,” advised Keil. “The two biggest mistakes people make with their HSA are that they don’t realize they can add into the HSA up to the IRS maximums — they usually think the only money they can put in is their $50-$100 per-paycheck contribution — and they don’t realize they can invest the money for the long run. 

“Quite often they feel stuck with the provider their company uses and stuck with the default interest rate investment. Even if they can’t move it, which they should be able to, they can always open another HSA to make their personal contributions up to the annual limit, and then use the other HSA for their long-term investing.”

Roth IRA: Offers Flexibility and Control Over Future Taxes

Laura Redfern, CFP, CeFT at Shadowridge Asset Management, LLC said she often recommends Roth IRAs to her clients.

“Contrary to what some people think, a Roth IRA isn’t just for young investors,” Redfern said. “Building Roth assets at any age can be a powerful tool to help you build flexibility and control over your future taxes.”

Redfern said this is because qualified Roth distributions are tax-free. 

“As long as the Roth IRA has been open for at least five years and you meet the requirements, you can withdraw from a Roth IRA without pushing yourself into a higher tax bracket,” she said.“This can be especially important for people concerned about paying taxes on their Social Security benefits, and/or Medicare surcharges.”

Redfern said another benefit to having a Roth IRA is that the IRS allows you to leave money in your IRA as long as you live. 

“In other words, unlike traditional tax-deferred accounts, which require you to start taking the money out when you reach a certain age, with a Roth there are no required withdrawals, ever,” she said. “You can keep building tax-free growth as long as you live.

“Roth assets also pass to heirs tax-free, so building a Roth can provide a benefit to both you and your loved ones. That’s pretty exciting.”

403(b): No Income Limitations for Eligible Employees 

“Designed specifically for employees of public school systems, colleges, churches, and other 501(c)(3) tax-exempt organizations, these plans are a wonderful ‘gift from the IRS,’ as I like to call them,” said Redfern.

“First, 403(b)’s allow eligible employees to contribute more than they could to a regular IRA,” she said. “In 2024, for example, an employee under the age of 50 can contribute up to $23,000 — that’s far more than the $7,000 limit on IRA contributions.

Second, Redfern said that there are no income limitations on 403(b)’s like there are on IRAs. 

“So a high-income couple could potentially contribute the maximum to a 403(b) and save a significant amount in taxes,” she said.

“403(b)’s also come in both tax-deferred and Roth (tax-free) flavors; it’s up to the employer what types of plans are offered,” Redfern shared. “So depending on your situation, you could do a combo of pre-tax and post-tax contributions to build both during your working years. Like 401(k) plans, 403(b)’s also generally have hardship and loan options, which can offer even more flexibility to employees if they come upon rough times.

“Finally, in some cases, like many school districts, employers that offer a 403(b) plan also offer a variety of companies to choose from. That’s different from 401(k) plans, where there is usually only one company that is chosen by the employer, and the employees have no say. When multiple companies are available, the employees get more choice and I often see better options available due to the competition. The 403(b) companies are usually vetted by the employer, which gives employees some peace of mind, but also the choice of how they want their investments to be managed and who they want to work with.”

401(k): Allows Higher Savings Limits Than Most Other Accounts

Craig Reid, president and national practice leader of retirement and wealth at Marsh McLennan Agency, said that the first type of account he recommends is the 401(k), if your employer offers it. 

“This type of retirement account typically has the most bells and whistles — that is, the most provisions or options that allow the employee to make decisions that fit their specific situation,” Reid explained. “Many 401(k) plans today are also coupled with personal financial advice services designed to help improve financial outcomes. For higher-income earners or people with more discretionary income, the 401(k) also allows you to save higher limits than most other retirement accounts, affording you the opportunity to save for a better retirement.”

Brokerage Account: Offers the Most Flexibility

Ryan Janus, CFP with Janus Financial, said that if you’re looking for the most amount of flexibility, in general, a brokerage account — aka a “non-retirement account” — is a good option to keep in mind. 

“This account doesn’t have the same restrictions as retirement accounts like IRAs and 401(k)s do,” explained Janus. “This account could allow for tax-loss harvesting, which could lower both ordinary income and capital gains taxes. Depending on what other income you have, gains from this account could even be taxed at a 0% rate. These types of accounts may also qualify for a Securities Backed Line of Credit (SBLOC), which could provide an additional layer of flexibility for someone who may not want to sell the positions in their account and create taxable gains — or maybe just want some additional liquidity.”

Solo 401(k): Offers the Ability To Lower Taxes and Take Loans

“For those who are self-employed, they have a lot of great options to evaluate,” said Janus. “If the goal is to defer their tax bill in high income years, they can utilize a solo-401(k) or a self employed pension plan to defer a substantial amount of income and lower their tax bill. 

“If looking for flexibility, a solo-401(k) provides options for both pre-tax and Roth contributions. This is one way a high income earner could still contribute to a Roth account without worrying about income limits. 

“A common reason why a lot of self employed investors are concerned about investing in retirement accounts is because of the age restrictions on withdrawals. A solo-401(k) plan could allow for loans from the plan, giving a business owner an additional layer of flexibility not offered by other retirement savings vehicles.”

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