Determining Your Retirement
Account Contribution Order

The order in which you make contributions to a 401(k) and a Roth IRA or Traditional IRA can help you meet your retirement savings goals and provide greater financial flexibility once you retire.

Your priority should be to save 15% or more of your annual income (including any employer contributions) and to direct those retirement dollars into the account where they can produce the most retirement income. If your workplace retirement plan offers an employer matching contribution, your first savings dollars should be directed to your plan to receive the matching contributions. But most employers only match part of what you contribute. So where should you direct your remaining contributions?

Answering the questions below can help you choose the best contribution order for your situation.

Determining Your Retirement Account Contribution Order

1To make nondeductible contributions to a Traditional IRA, there are no income limits. However, if you and/or your spouse participate in an employer-sponsored retirement plan, the amount of the deductible contributions will depend on your modified AGI.
2All individuals are eligible to make designated Roth contributions within a 401(k) if offered by their employers—there are no income limitations.

1Make the most of your retirement assets by strategically allocating your contributions.
2STUART RITTER, CFP®, a senior financial planner with T. Rowe Price, explains who can benefit from Roth IRAs’ advantages.
3A Thoughtful Approach to Retirement Investing.
4When and how you start collecting Social Security will affect the total amount of benefits you receive
5Make your IRA contributions for 2013; invest your tax refund with direct deposit; a new way to qualify for premium services; and more.
6An investor survey shows that there is no one way to retire.
7"Stretching" an Inherited IRA offers your heirs the potential for decades of tax-advantaged growth.
8History shows why maintaining an allocation to stocks and bonds that is appropriate for your financial goals can lead to long-term growth.
9Work toward the future you want by taking action today.
9Understanding what your estate is worth can help ensure your planning efforts are on the right track.