Retirement Accounts, Decoded
Six account types, one question each: who gets taxed, and when. Start with the free money and work down to the accounts almost nobody uses correctly.
8 articles · about 71 min in total
Start with The 401(k) Match Is Free Money. Don't Leave It on the TableThis is the highest return per hour of reading on the whole site, and it is not close. Fund selection might move your outcome by a fraction of a percent a year. Getting the account wrapper right moves it by far more, and part of it is simply free money.
Every account here answers one question in a different way: who gets taxed, and when. Traditional accounts tax you later, Roth accounts tax you now, and the health savings account does neither if you use it for what it is designed for.
The trap in this section is dates. The backdoor Roth pro-rata rule measures your traditional IRA balances on 31 December, not on the day you convert. The 529 to Roth rollover runs on a fifteen-year clock, which means opening the account is worth doing long before funding it makes sense. Miss the date and the strategy is gone, not delayed.
None of this is tax advice and the thresholds move most years. Each article states the year its numbers come from, and that matters more here than anywhere else on the site.
Key takeaways
- An employer 401(k) match is an immediate return on contribution, which makes contributing up to the match the highest-certainty investment decision available to most people.
- Choosing Roth or traditional is a bet on whether your tax rate in retirement will be higher or lower than it is today.
- The health savings account is the only account offering a deduction on contribution, tax-free growth, and tax-free qualified withdrawals.
- The backdoor Roth pro-rata rule aggregates all traditional, SEP and SIMPLE IRA balances on 31 December of the conversion year, not on the conversion date.
Step 1: The 401(k) Match Is Free Money. Don't Leave It on the Table
An employer 401(k) match is the only guaranteed 50% to 100% return you will ever be offered, and skipping it is the most expensive money mistake most workers make. Here is how the formulas and vesting actually work.
Jun 19, 2026 · 8 min read
Step 2: Roth 401(k) vs Traditional 401(k): How to Choose
A traditional 401(k) skips tax now and pays it in retirement. A Roth 401(k) pays tax now and skips it later. The whole decision is a bet on your future tax rate, and for a lot of people the answer is clearer than it looks.
May 29, 2026 · 8 min read
Step 3: Roth vs Traditional IRA: Which One Actually Wins
The whole Roth vs Traditional debate reduces to one question: is your tax rate higher now or in retirement? The math is symmetric. The decision is a bet on future tax rates. For most people under 40 who aren't high earners, Roth is the default that ages well.
May 31, 2026 · 10 min read
Step 4: The Backdoor Roth Is Simple. The Pro-Rata Rule Measures a Date You Weren't Watching.
Contribute to a traditional IRA, convert to Roth, done. That works cleanly only if your other traditional IRA balances are empty, and the balance that decides it is measured on December 31, not on the day you convert. Which means a rollover in November can retroactively tax a conversion you made in March.
Jul 29, 2026 · 9 min read
Step 5: The HSA Is a Stealth Retirement Account (the Only Triple-Tax-Free One)
Everyone treats the HSA as a medical checking account. It is quietly the best tax shelter in the country: deductible going in, tax-free growth, tax-free out for medical, plus a payroll-tax escape no 401(k) or IRA offers. Here is how to actually use it.
Jun 25, 2026 · 8 min read
Step 6: The 529 Roth Rollover Runs on a 15-Year Clock. Open the Account Now, Fund It Later.
SECURE 2.0 answered the standing objection to 529s: unused money can move to the beneficiary's Roth IRA. But the account has to be 15 years old, and the clock starts when you open it rather than when you fund it. Which makes the decision that matters a calendar decision, not a contribution one.
Jul 29, 2026 · 9 min read
Step 7: Your Company Withholds 22% on RSUs. Your Real Rate Is Probably 32%.
RSUs are taxed as ordinary income the day they vest, but your employer withholds at a flat supplemental rate that has nothing to do with your actual bracket. That gap is why so many people in tech get an April bill they did not budget for. There is a second, worse error hiding on the 1099-B.
Jul 29, 2026 · 10 min read
Step 8: When to Claim Social Security: The Break-Even Math
Claiming at 62 is a permanent 30% pay cut. Waiting until 70 is a permanent 24% raise. The crossover between them is a number you can compute in about four lines of arithmetic, and it lands almost exactly on your life expectancy, which is why the break-even is the wrong thing to optimize.
Sep 3, 2026 · 9 min read
Frequently asked questions
- Should I choose a Roth or a traditional retirement account?
- Choose Roth if you expect a higher tax rate in retirement than today, which usually means early career. Choose traditional if you expect a lower one, typically at peak earnings. When the two look close, splitting between them hedges the bet.
- What is the pro-rata rule on a backdoor Roth?
- It stops you converting only after-tax dollars while leaving pre-tax dollars untouched. The taxable share of a conversion is set by the ratio of pre-tax to total balances across all your traditional, SEP and SIMPLE IRAs, measured on 31 December of the conversion year.
- Why is an HSA called a stealth retirement account?
- Because after age 65 it behaves like a traditional IRA for non-medical withdrawals while staying entirely tax-free for qualified medical costs. Combined with the deduction on the way in, that makes it the only triple-tax-advantaged account available.
- Do I really need to contribute up to my employer match?
- Yes, before almost anything else. A match is an immediate guaranteed return on the money you put in, and no investment available to a retail investor offers a comparable certainty. Leaving it unclaimed is declining part of your compensation.