Retirement
Retirement planning is mostly arithmetic and patience. The accounts get simple once you know which order to fund them.
Retirement planning has a reputation for complexity that is mostly undeserved. The accounts come in three or four flavors. The contribution limits move a little each year. The math for how much you need is a single formula with a couple of inputs. Most of what makes retirement feel intimidating is the marketing layer the financial industry has built on top of a simple problem: save consistently, invest cheaply, do not touch it.
The two main account types, traditional and Roth, differ only in when you pay the tax. Traditional accounts give you the deduction now and tax the withdrawal later. Roth accounts take the tax now and let the growth come out tax free. For most people in their twenties and thirties, Roth wins because their tax rate is lower now than it will be at peak earnings. For higher earners in their fifties, traditional often wins. There are edge cases, but that is the rule of thumb.
The number you need to retire is roughly twenty-five times your annual expenses, assuming a 4% withdrawal rate. If you spend sixty thousand a year, you need about one and a half million invested to retire safely. That feels like a wall when you are starting. The arithmetic is more forgiving than it looks because compounding does most of the work, but only if you give it thirty years and resist the urge to interrupt it.
Featured guides
All guides →Everything on Retirement
Park the cash you have not invested at 4%+.
Your emergency fund and any near-term savings have no business in big-bank checking. The rate spread between checking and a top HYSA is real money on dollars you already have.
See top high-yield savings rates →Contributors
Latest articles
April 2026 - May 2026A handful of legislative changes narrow the conversion playbook. What to do this year if you qualify.
What the match is really worth, this year contribution limits, and when the money is truly yours.
Early, on time, or delayed to 70. How the math changes with health and other income.
What it takes to retire early, and where the standard assumptions get fragile.
Common questions
As soon as you have stable income and an emergency fund. A dollar invested at age twenty-five becomes roughly ten dollars by sixty-five at typical market returns. The same dollar invested at thirty-five becomes five dollars. The first decade of contributions does an outsized share of the work because compounding has the most time.
You can leave it in the old plan, roll it into the new employer plan, or roll it into a traditional IRA at a broker of your choice. The IRA rollover usually gives you the most investment options and the lowest fees, which is why most people do it. Just make sure it is a direct rollover so you do not trigger a tax bill.
In 2026, the limit is $7,000, or $8,000 if you are fifty or older. There is an income phase-out, so high earners may not be able to contribute directly. If you are above the limit, the backdoor Roth conversion is a legal workaround that most brokers can walk you through.
Yes, with caveats. The math works if you save fifty to seventy percent of your income for ten to fifteen years and keep your expenses low in retirement. The harder parts are health insurance before Medicare kicks in at sixty-five, sequence of returns risk in the first few years, and the psychological adjustment of stepping away from work earlier than most people you know.