Traditional Retirement Accounts or Roth? How to Choose

Let’s compare traditional IRAs, traditional 401(k)s, Roth IRAs and Roth 401(k)s. Which might work best for you could depend on your income and tax status.

A woman stands at a fork in a path, contemplating which way to go.
(Image credit: Getty Images)

When it comes to funding your retirement, there may be no more popular solution than the standard employer-sponsored 401(k). But that’s not the only option for putting your earned income to work for post-career life. A Roth IRA or Roth 401(k) could make sense based on your age, income and financial need.

There’s no disputing the potential power of contributing to a 401(k) plan as a path toward a financially stable retirement. Employer-sponsored plans offer generous contribution limits and potential “free money” in the form of employer match programs. But Roth IRAs and Roth 401(k)s can also be effective and tax-advantaged options for investors willing to pay the taxes upfront.

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Rich Guerrini
President and CEO, PNC Investments

Rich Guerrini is the President and Chief Executive Officer of PNC Investments. In his role, he is responsible for all sales, operations, risk and compliance activities for the retail investments organization. Prior to his current responsibilities, Guerrini was Executive Vice President and Managing Director of Alternative Investments for PNC Investments and was responsible for development and rollout of the PNC Investment Center and PNC’s web-based investment offering.