The Complete Guide to 401(k) and IRA Accounts

401(k) and IRA accounts have been haunting me since I was like 23 and my first real job dumped a packet on my desk titled “Welcome to Retirement Planning!” and I literally put it in a drawer for four years.

I’m sitting here in my messy office nook in the US, January 2026, heat blasting because it’s somehow 18°F outside again, eating leftover lo mein straight from the carton, staring at my Fidelity and Vanguard apps like they personally betrayed me. Spoiler: they didn’t. I betrayed future me. Anyway.

Here’s the raw, unfiltered, please-don’t-judge-me-too-hard guide to 401(k) and IRA accounts from someone who definitely did not have their shit together until embarrassingly recently.

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(If those don’t quite nail the chaotic cozy regret vibe, imagine adding some floating spectral 401(k)

Why I Finally Stopped Ignoring My 401(k) and IRA Accounts

Back in 2019 I was making $54k in a mid-size city, contributing exactly 1% to my 401(k) because “free money” sounded good but also rent existed. My employer matched 50% up to 6%. I was literally leaving $1,600+ a year on the table for four straight years.

I calculated it once while drunk on a Tuesday and almost threw up.

That’s the first brutal truth nobody tells you loud enough:

• If your job offers a 401(k) match → not contributing at least enough to get the full match is basically refusing part of your salary
• It’s the closest thing to free money that isn’t actually a scam

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Sources I wish I’d read sooner:

• Investopedia – 401(k) Matching
• IRS – 401(k) Resource Guide

[Insert inline image 1 – that shameful 2 a.m. phone screenshot moment]

401(k) vs IRA Accounts – What I Actually Use in 2026

The 401(k) – My Boring-but-Effective Workhorse

I’m maxing it this year. The 2026 employee contribution limit is $23,500 (plus $7,500 catch-up if you’re 50+). Yeah, it hurts. But I’m 34 and finally scared enough of being 74 with $11,000 to do it.

Pros that finally clicked for me:

• Pre-tax → lowers taxable income now (huge when you’re in the 22-24% bracket)
• Employer match (still only 50% up to 6% but whatever, it’s something)
• Auto-escalation feature I turned on—bumps me 1% every January 1st whether I like it or not

Cons I hate:

• Investment choices usually suck unless you have a mega good plan
• My old job’s plan had a 1.18% expense ratio on the target-date fund. Criminal.

I rolled that garbage into an IRA last year.

Roth IRA – The “I’m Betting on Myself Getting Richer” Move

I do a backdoor Roth IRA every year now because my income is creeping too high for direct contributions (2026 phase-out starts around $153k single, check IRS.gov because it changes).

How I do the backdoor (super simplified, not advice, talk to your CPA):

1. Contribute to traditional IRA (non-deductible)
2. Immediately convert to Roth IRA
3. Pay taxes on any gains between step 1 & 2 (usually $0 if done fast)

Favorite low-cost Roth IRA providers I actually use:

• Vanguard – boring, cheap, reliable
• Fidelity – slightly sexier app, zero-fee index funds
• Schwab – customer service actually picks up the phone

[Insert inline image 2 – my coffee-stained 2023 statement with the angry red circles]

My Biggest 401(k) and IRA Screw-Ups So Far (So You Don’t Repeat Them)

• Left $22k in an old 401(k) earning 0.04% for 18 months because “I’ll deal with it later”
• Chose the target-date 2060 fund with 1.18% fees instead of the S&P 500 index at 0.03% for three years
• Forgot I had a tiny old IRA and missed the 2024 contribution deadline by six days (yes I cried)
• Panic-sold $8,000 worth of stocks in March 2020 like a complete clown

I still wake up sometimes thinking about that last one.

Quick 2026 Numbers I Keep Open on My Phone

• 401(k) employee limit: $23,500
• Catch-up (50+): +$7,500 → $31,000 total
• IRA limit (traditional or Roth): $7,000
• Catch-up (50+): +$1,000 → $8,000
• SEP-IRA max: 25% of compensation up to $70,000 (if you’re self-employed, jealous)

Current IRS source: IRS 2026 Retirement Plan Limits Announcement (they usually release late fall so check back if it’s early in the year)

[Insert inline image 3 – ironic running shoes + sticky note combo]

Okay, So What Am I Actually Doing Right Now in 2026?

• Maxing the 401(k) at 15% + getting the full match
• Backdoor Roth IRA every January like clockwork
• 80% in broad-market index funds (VTI / VXUS or FZROX / FZILX if Fidelity)
• 20% in boring bonds because I’m not 25 anymore and crashes hurt more now
• Auto-escalating 1% every year until I hit the max

It’s not sexy. It’s not fast. But the balance doesn’t make me want to vomit anymore, so that’s progress.

Look, I’m still figuring this out. I still eat cereal for dinner sometimes. I still impulse-buy dumb shit on Amazon. But putting real money into 401(k) and IRA accounts every month is the first adult thing I’ve consistently done without someone nagging me.