The 401k account is a common benefit you'll find at most jobs. It's a tax advantage retirement account that employees can opt into. Some employers even offer matching contributions up to a certain limit — to encourage you to save for retirement.
Traditional vs Roth: some employers now offer a Roth version. A Traditional 401k lets you invest pre-taxed dollars. You'll be taxed on withdrawal. A Roth 401k is the opposite: you'll be taxed before investing, but your accounts will grow tax free and will not be taxed on distribution.
As a general rule-of-thumb, use a Traditional 401k if you think you'll be in a lower tax bracket when you start withdrawing from it. Use a Roth 401k if you think you'll be in a higher tax bracket while withdrawing. Most people fall in the first case. Some examples of people who would fall in the later case: someone who plans on working forever or someone expecting large income from rental properties later in life.
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