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Retirement Basics: Two common ways to save

Personal Investing

To keep things simple, let’s focus on the two most common ways to save for retirement.

First, there’s your employer’s retirement plan. At most companies, the plan will be called a 401(k). If you work for a nonprofit, government agency or other eligible groups, your plan may be a 403(b) instead. In addition to traditional 401(k) or 403(b) plans, your employer may offer a Roth 401(k) or even a pension.

Second, is a personal retirement account. Most people are eligible to open a traditional IRA or a Roth IRA on their own (although Roth IRAs have income restrictions). If you participate in a high-deductible health insurance plan, you might choose to open a Health Savings Account (HSA), which can be a great way to save for medical costs during retirement.

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