The right order for your retirement dollars.
Most calculators hedge. This one commits. Get the employer match, max the Roth IRA, then back to the 401k. Below is the math, the 2026 limits, and a calculator that models all three.
- 1MatchEmployer capOften 3 to 6 percent of salary, free money
- 2Roth IRA$7,500Full 2026 personal limit, tax free growth
- 3401k max$24,500Back to the 401k toward the employee cap
401k and Roth IRA, side by side
The eight differences that change the answer for almost everyone.
| Feature | 401k | Roth IRA | Edge |
|---|---|---|---|
| 2026 contribution limit | $24,500 employee | $7,500 | 401k |
| Catch up (50 plus) | $8,000 (total $32,500) | $1,100 (total $8,600) | 401k |
| Tax on contributions | Pre tax (deductible) | After tax | Tied |
| Tax on qualified withdrawals | Ordinary income | Tax free | Roth |
| Employer match | Common | Never | 401k |
| Income limits | None | $153k to $168k single | 401k |
| Required minimum distributions | Yes, age 73 | None for owner | Roth |
| Withdraw contributions early | Penalty before 59.5 | Any time, penalty free | Roth |
Project your three scenarios
Adjust your inputs. The optimal scenario captures every dollar of employer match plus a fully funded Roth IRA.
Project your retirement balance
Employer dollars compounded at 7%. Skip the match and this is the number you leave behind. Output uses 2026 IRS limits, including age based catch ups (50 plus) and the 60 to 63 super catch up.
Why this order works
Three reasons the match plus Roth combination beats everything else.
The match is a guaranteed 50 to 100 percent return
A 50 percent match means every dollar you put in becomes $1.50 instantly. No public market consistently delivers that. Skip it and you are turning down compensation.
Roth IRA growth is permanently tax free
After tax contributions today, tax free growth and qualified withdrawals later. No RMDs in your lifetime. You also keep access to contributions in an emergency.
The 401k catches what is left
Once the match is captured and the Roth IRA is full, additional 401k contributions reduce taxable income today and shelter growth from current taxes.
What people ask first
Should I contribute to my 401k or Roth IRA first?+
401k up to the employer match first, every time. After the full match, max the Roth IRA at $7,500 (or $8,600 at 50 plus). Then back to the 401k toward the $24,500 employee cap.
What is the 401k contribution limit for 2026?+
$24,500 base. Add an $8,000 catch up at age 50 for $32,500. Ages 60 to 63 get a SECURE 2.0 super catch up of $11,250 for a total of $35,750.
Can I contribute to both a 401k and a Roth IRA?+
Yes. They are independent accounts with independent limits. The only ceiling for the Roth IRA is the income phaseout: $153,000 to $168,000 single and $242,000 to $252,000 married filing jointly in 2026.
What if I earn too much for a Roth IRA?+
Use the backdoor Roth IRA: contribute to a non deductible Traditional IRA, then convert to a Roth. Watch the pro rata rule if you have other pre tax IRA balances.