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One decision you may face when saving for retirement is whether to contribute to a traditional retirement savings account or a Roth account. A key thing to consider is when you prefer to pay taxes on the money you contribute. With traditional accounts, you don’t pay taxes on contributions when you make them but will when you take them out. With Roth accounts, you pay taxes on contributions when you make them but won’t when you withdraw them, as long as you meet certain requirements.

Understanding how these account types compare can help you choose between a traditional and Roth IRA. And if your retirement plan offers traditional and Roth options, it can help you decide whether to contribute to one or the other — or both.

Use these quick comparison charts to find out how they stack up. Keep in mind that these are general overviews and there may be exceptions. Discuss your plan requirements and situation with your plan sponsor, whether it's your employer or another organization. You can also reach out to your financial professional.

401(k), 403(b), 457(b) plans
Roth in-plan account Traditional in-plan account
Eligibility
  • You must be employed by the plan sponsor or have employment compensation
  • There are no income limits that prevent participation
  • You must be employed by the plan sponsor or have employment compensation
  • There are no income limits that prevent participation
Taxes
  • Contributions are made after-tax, so they don't reduce income taxes for the year in which you make them
  • Contributions are made pre-tax, which reduces income taxes for the year in which you make them
Maximum annual contributions
  • In 2026, the limit is $24,500; for those over age 50, it’s $32,5001 and for those who will reach age 60-63 by the end of the year it's $35,7501
  • If you’re eligible to contribute to both a 401(k) and 403(b), this limit is a combined amount you can contribute across plans
  • If you have a 457(b) plan, you may be eligible to contribute the maximums to both that and a 401(k) or 403(b)
  • In 2026, the limit is $24,500; for those over age 50, it’s $32,5001 and for those who will reach age 60-63 by the end of the year it's $35,7501
  • If you’re eligible to contribute to both a 401(k) and 403(b), this limit is a combined amount you can contribute across plans
  • If you have a 457(b) plan, you may be eligible to contribute the maximums to that and a 401(k) or 403(b)
Contribution deadline
  • For tax year 2026, by the end of the plan year, which for most plans is the end of the calendar year
  • If you leave your job, in most cases you can’t contribute past the last day of employment with your plan provider
  • For tax year 2026, by the end of the plan year, which for most plans is the end of the calendar year
  • If you leave your job, in most cases you can’t contribute past the last day of employment with your plan provider
Withdrawals
  • Contributions are withdrawn tax-free
  • Earnings can be also withdrawn tax-free if the withdrawal meets plan distribution requirements, the account has been open for at least 5 years and at least one of the following conditions is met: age 59½ or older, disability or death
  • Contributions and earnings are taxed as ordinary income when withdrawn
  • Withdrawals from 401(k) and 403(b) plans before age 59½ may be subject to a 10% early withdrawal penalty
  • Withdrawals from a 457(b) plan may be taken without penalty if you are no longer employed by the plan sponsor, regardless of age, or for a qualifying hardship
Required minimum distributions (RMDs)
  • None during the original accountholder's lifetime
  • Starting at age 73 if you were born in 1951 through 1959; starting at age 75 if you were born in 1960 or later
IRAs
Roth IRA Traditional IRA
Eligibility
  • You must have earned income below certain IRS limits based on your tax-filing status
  • If your income exceeds these limits, you may not be able to contribute or to contribute up to the maximum
  • A nonworking spouse in a married couple filing jointly on their taxes may be eligible to contribute to their own account
  • You must have earned income
  • A nonworking spouse in a married couple filing jointly on their taxes may be eligible to contribute to their own account
Taxes
  • Contributions are made after-tax and are not tax-deductible
  • Contributions may be tax-deductible
  • You may not be eligible for a tax deduction or your tax deduction may be reduced if your income exceeds certain IRS limits and you or your spouse are covered by an employer's retirement plan
Maximum annual contributions
  • In 2026, the limit is $7,500; for those over age 50, it's $8,600
  • This limit is a combined amount you can contribute across all IRAs
  • In 2026, the limit is $7,500; for those over age 50, it’s $8,600
  • This limit is a combined amount you can contribute across all IRAs
Contribution deadline
  • For tax year 2026, by the annual income tax filing deadline in 2027
  • For tax year 2026, by the annual income tax filing deadline in 2027
Withdrawals
  • Contributions come out first and are always withdrawn tax-free
  • Earnings come out last and can also be withdrawn tax-free if the account has been open for at least 5 years and at least one of the following conditions is met: age 59½ or older, disability, qualified first-time home purchase or death
  • Earnings withdrawn prior to age 59½ may be subject to a 10% early withdrawal penalty unless an exception applies
  • Contributions and earnings are taxed as ordinary income when withdrawn
  • Withdrawals made prior to age 59½ may be subject to a 10% early withdrawal penalty unless an exception applies
Required minimum distributions (RMDs)
  • None during the original accountholder's lifetime
  • Starting at age 73 if you were born in 1951 through 1959; starting at age 75 if you were born in 1960 or later
Take advantage of the investment options your retirement plan offers. Start or increase your retirement savings today.
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Plan documents indicate which catch-up options are available.

[1] Starting in 2026, if your prior-year wages exceed $150,000 in FICA (Social Security) wages (indexed for inflation), your age-based catch-up contributions must be Roth contributions. For more information, see our article "Boost your retirement savings".