Retirement Saving Without a 401(k)

Many working Americans don’t have access to a 401(k). I don’t mean their employer doesn’t offer them any matching funds, I mean they flat out do not have the ability to contribute funds to a 401(k). Many of these employers are either too small, too disorganized, or otherwise find itself unable to stand up a 401(k) plan and sign up with an administrator. Whatever the reason, this leaves one of the greatest tools for retirement planning unavailable to many Americans so Yahoo Finance took it upon themselves to outline some alternatives to the 401(k) for our 401(k)-less brethren.

The number one answer to this question is that you should start contributing to an IRA. The difficulty here is that if the Roth and Traditional IRA share a single limit of $5,000. If you contribute $5,000 to a Roth, then you can’t contribute that to a Traditional IRA. You can split up your contributions, $2,500 each, but that is significantly less than the $15,500 limit 401(k) contributors can take advantage of.

The number two answer is to appeal to your employer and ask if they could look into standing up a 401(k) plan. Outside of the traditional IRA, there is simply no other alternative. There are 401(k)-like retirement plans but ultimately any employer with a significant number of employees should consider this huge benefit.