Decide which investment account is right for you

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Here’s an overview of 4 common types of investment accounts. (via CNBCMakeIt)

is similar to a 401, but anyone can open one on their own at a financial institution like Vanguard or Fidelity. If your employer doesn't offer a 401, or offers one but does not include a contribution match, you can consider an IRA for retirement investments.

One benefit of IRAs is that you will typically have many more investment options than in a 401. That can help youRoths are a type of IRA, except that instead of contributing pre-tax money, you invest income that's already been taxed. Then, when you make withdrawals in retirement, you don't pay any taxes. You lock in your current tax rate when you contribute, which makes Roth IRAs an, who are likely in a lower tax bracket now than they will be later on.

In some cases, you can also withdraw up to $10,000 for a first-time home purchase. If you're able, investing in both a 401 or IRA and a Roth IRA is a smart move because it adds diversity to your retirement income streams, which is always a good idea. You can buy stock in individual companies and other types of alternative investments through these accounts, and typically there is a much wider selection of investment options than those available through your retirement investment accounts. You pay taxes when you make money on an asset in the account, such as selling a stock. But you can still invest in less risky options, like index funds, too.

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