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Saving and investing for retirement is serious business. If you hold off on either, you could cripple your chances of retiring comfortably and on your own terms.

Arguably one of the biggest questions Americans are faced with is where and how they should invest their money. Opening an investment account with a brokerage is a great start, and holding stocks over the long term (366 days or more, specifically) can reduce your tax liability, but it's often not the best way to grow your money over time. Instead, turning to tax-advantaged retirement tools can typically give you more bang for the buck.

Two of the most popular tax-advantaged tools Americans have at their disposal are the 401(k), which is offered by your employer, and the Roth IRA, which you can open yourself through a brokerage. Let's take a brief look at both tax-advantaged vehicles to establish their unique advantages and disadvantages -- then we'll double back and answer the question of which one is your best option.

Note that there are other tax-advantaged tools that may be at your disposal, such as the traditional IRA and the Roth 401(k), but since the 401(k) is the most popular employer-sponsored retirement tool in America, and the Roth IRA is arguably one of the fastest-growing retirement vehicles, we'll stick to comparing those two today.

What you need to know about a 401(k)

A 401(k) is a plan sponsored by your employer that allows you to contribute pre-tax dollars for investment.

One of the biggest advantages of a 401(k) is the generous contribution limits. In 2016, workers aged 49 and below can contribute up to $18,000 per year, while workers aged 50 and up can contribute up to $24,000 annually (older workers are allowed to contribute that extra $6,000 in case they need to catch up on their retirement savings). What's more, contributions to a 401(k) are often adjusted for inflation, meaning that what you're able to contribute will likely increase every couple of years.

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As noted above, money contributed to a 401(k) is usually taken directly out of your paycheck before income taxes are taken out, which means contributing to a 401(k) can help to reduce your taxable income in the current year. Paying less in taxes could boost your ability to save.

Another prime reason why 401(k)s are highly coveted is the potential for matching contributions from your employer. As workplace pensions become a thing of the past, employers are helping their employees prepare for retirement by offering to match workers' 401(k) contributions up to a certain percentage of their salary. That means your employer will give you free money -- and all you have to do to get it is contribute what your employer is willing to match. While all businesses differ, an employer match of around 3% is fairly common.

The biggest disadvantage of a 401(k) is that it's merely a tax-deferred investment vehicle. Your money will grow tax-free for decades, but Uncle Sam will eventually want his cut. Once you're retired and begin making withdrawals from your 401(k), you'll be responsible for paying federal income tax on those withdrawals.

A separate concern with the 401(k) is that fees can be high, and the investment choices can be narrow. Businesses often contract with a single investment firm, so your investment options could be limited to what that investment firm offers. Annual management fees can also add up over time, reducing the nest egg you expect to have when you retire.

Lastly, a 401(k) requires you to start taking annual minimum distributions when you 70-1/2.

What your need to know about a Roth IRA

In the other corner we have the Roth IRA. Money contributed to a Roth IRA is in after-tax dollars, meaning there are no up-front tax benefits. The Roth's biggest advantage, however, is that your investment gains within your account are tax-free for life.

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Another big advantage of the Roth IRA is that it provides extreme financial flexibility. There aren't any minimum required distributions associated with a Roth, so the accountholder can allow the money to continue to grow over time, taking distributions at a time and amount of his or her own choosing. Also, there are no minimum age requirements with a Roth IRA, meaning that seniors can continue contributing well beyond age 70-1/2, unlike a traditional IRA.

Adding to that flexibility, accountholders are free to withdraw the amount they've contributed to a Roth at any time, even before turning 59-1/2, the age at which you can typically start withdrawing funds without a penalty. Note, however, that you probably won't be allowed to take any investment gains without paying a penalty if you're under age 59-1/2.

A final benefit of the Roth IRA is that it allows you to choose from a wide gamut of investments, as well as offerings from your own brokerage firm.

But there are disadvantages, too. Whereas a 401(k) allows you to contribute up to $18,000 annually, or $24,000 starting at age 50, a Roth IRA only allows a maximum of $5,500 for persons aged 49 and under and $6,500 for those who are 50 and up.

A Roth IRA also has income limits with regard to who can contribute. In 2016, single filers begin to see their contribution limit phase out at $117,000 in adjusted gross income (AGI). By $132,000 they become ineligible to contribute. Married couples start facing the phase-out at $184,000 and become ineligible to contribute when their AGI hits $194,000. 

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Which tax-advantaged plan is best for you?

So which plan is the best for you? The answer to that question probably comes down to your tax situation.

On the one hand, a 401(k) allows you to contribute the most, and your nest egg can grow with matching contributions from your employer. On the other hand, the tax-free gains from a Roth simply can't be beat. If you believe your income will increase during retirement, and you'll subsequently be pushed into a higher tax bracket, then chances are you'll be better off with a Roth IRA, which doesn't count as taxable income. If, however, you expect to be in a similar or lower tax bracket, then the 401(k) could be your better choice. Once again, remember that these aren't the only tax-advantaged accounts available, and there are other varieties of 401(k)s and IRAs, so be sure to explore those options as well.

Personally, I suggest you choose both. The Roth IRA can be particularly valuable because of its tax-free status over the lifetime of your account, but a 401(k) -- assuming you can get at least some match from your employer -- can be a powerful saving tool as well. Contributing to both gives you the best of both worlds from a tax perspective, and it opens the door for multiple channels of income during retirement.