5 Best Retirement Accounts in 2024

The best retirement accounts available this year can help you save more and optimize tax savings to prepare for retirement. Find your best choices here.

With longer lifespans and rising costs, securing your retirement has never been more crucial for retirement planning. While the dream of filling your days with travel, family or your favorite hobby can sound like paradise, make sure you have enough money to enjoy your golden years. A constricted budget or money worries can make retirement stressful. Planning now to build your retirement savings can help you build more. 

What will life be like when you no longer go to work every day? Your autonomy will delight you as you fill your days with activities you only dreamed of having time for during the decades of your 9-to-5 work day. 

As you look into maintaining a strong retirement income or maximizing your retirement benefit package, you can open a tax-deferred retirement account or brokerage account and begin to build your nest egg. Benzinga’s guide breaks down the best retirement accounts to help you chart the ideal path toward your dream retirement.

• Best for People with a 401(k) Option at Work: A Traditional or Roth 401(k)
• Best for Small Business Owners and Gig Workers: SEP, SIMPLE or Solo 401(k)
• Best for Workers with No 401(k) Option: An IRA 
• Best for a Spouse out of the Workforce:  An IRA Based on Your Spouse’s Earnings
• Best for After-Tax Growth: Roth IRA 

The 5 Best Retirement Plans

When it comes to retirement planning, a one-size-fits-all approach rarely succeeds. That's why it's important to understand the diverse array of retirement accounts, each with its unique features and advantages. 

Before getting started, you can check out how much you need to retire, compare average retirement by age and experiment with Benzinga's retirement calculator. Once you've got figures in mind, here are the top five retirement plans to consider in 2024 that can help you make informed decisions for a prosperous future.

1. Best for People with a 401(k) Option at Work: A Traditional or Roth 401(k)

A 401(k) is an employer-sponsored retirement savings plan that allows you to contribute a portion of your pre-tax income, reducing your taxable income for the year. These contributions, along with any employer-matched funds, grow tax-deferred until retirement.

A 401(k) from your company is the best retirement account you can have. It allows the highest tax-incentivized contribution amount, the possibility of a loan, set-and-forget automatic withdrawals and potential company matching. If you have this benefit at work, use it and try to reach your contribution limit. You can also compare 401(k) vs. 457 plans. 

2. Best for Small Business Owners and Gig Workers: SEP, SIMPLE or Solo 401(k)

If you have a profitable main or side business and no 401(k) at work, you can start your own retirement plan even if you are your only employee. For self-employed individuals and small business owners, there are several retirement plan options, including SEP IRAs, SIMPLE IRAs and Solo 401(k) plans. 

A company plan allows higher tax-incentivized deferrals and gives you an additional business expense to deduct. A SIMPLE IRA, SEP or Solo 401(k) are relatively easy to set up and maintain and offer tax-deferred or tax-free growth opportunities, depending on the plan type.

3. Best for Workers with No 401(k) Option: An IRA 

A traditional IRA is a tax-deferred retirement savings account that allows you to contribute pre-tax dollars, reducing your taxable income for the year. Contributions and earnings grow tax-deferred until retirement when withdrawals are taxed as ordinary income.

If you have no 401(k) option, max out your contributions every year to an IRA that you set up yourself at a brokerage like E*TRADE, Fidelity, Vanguard or other similar places. You can find the best IRA accounts here.

4. Best for a Spouse out of the Workforce:  An IRA Based on Your Spouse’s Earnings

If your spouse works but you don’t, you can still contribute to an IRA. The basis of retirement account savings is that you have to earn money to put money in one. But if your spouse earns, you can use his or her earnings as if they were your own to contribute that $8,000 each year. Income limits apply in this case.

5. Best for After-Tax Growth: Roth IRA 

A Roth IRA is a retirement savings account funded with after-tax dollars. While contributions are not tax-deductible, qualified withdrawals in retirement are tax-free. Roth IRA contribution limits are the same as a traditional IRA: $7,000 per year ($8,000 for those aged 50 and older). It also has maximum income limits: $161,000 for single tax filers and $240,000 for those married filing jointly. 

If you earn more than the income limits, you could consider a backdoor Roth IRA or a Roth IRA conversion. You can also compare an IRA vs. 401(k) and then find some of the best Roth IRA accounts. 

Other Retirement Accounts to Consider

While these plans are among the most popular, other types of retirement accounts are worth considering.

• Health Savings Accounts (HSAs) can be used for retirement planning and medical expenses. More about HSAs are available here. 
• Annuities offer fixed income, based on the type of annuities. Learn more about annuities. 
• Defined benefit plans are a type of pension plan in which an employer or sponsor promises a specified pension payment, lump-sum or combination based on the employee's earnings history, years of service and age. 
• Cash balance plans are pension plans that offer employees the option of receiving their benefits in the form of lifetime annuities. Learn about cash balance plans. 
• Employee Stock Ownership Plans (ESOPs) allow a company's employees to own shares in that company. 

Key Plan Benefits to Consider

When evaluating retirement accounts, it's essential to consider several key factors that can impact your long-term financial security.

• Tax benefits: Look for accounts that offer tax-deferred or tax-free growth opportunities as well as potential upfront tax deductions for contributions.
• Contribution limits: Maximize your savings potential by choosing plans with higher contribution limits, especially if you're nearing retirement or playing catch-up.
• Investment options: Diversify your portfolio with accounts that offer a wide range of investment choices, from stocks and bonds to mutual funds and exchange-traded funds (ETFs).
• Withdrawal rules: Understand the rules and potential penalties for early withdrawals, as well as any RMDs that may apply.
• Employer matching: If available, take advantage of employer-matched contributions, which can turbocharge your retirement savings.
• Accessibility: Consider the ease of account setup, management and withdrawals, as well as any associated fees or administrative complexities.

Best Retirement Financial Advisors

While navigating the world of retirement accounts, seeking guidance from experienced financial advisors can be invaluable. Here are some of the top retirement financial advisors to consider.

Safeguarding Your Future

Securing a comfortable retirement requires careful planning and strategic use of the best retirement accounts available. By understanding the unique features, tax implications and contribution limits of each option, you can craft a tailored plan that aligns with your financial goals and future lifestyle plans. Seek professional guidance when needed, and remember – it's never too early or too late to start saving for the golden years you deserve. Find 11 ideas to save for retirement and learn more about investing for retirement.