3 Places to Save for Retirement in 2024 Besides a 401(k) Plan

If you're eager to save for retirement this year and your employer offers a 401(k) plan, you may decide to sign up. The nice thing about 401(k)s is that contributions are taken as payroll deductions, so there's little you need to do to get your account regularly funded. And also, you get tax benefits for funding a 401(k).

But what if your employer doesn't offer a 401(k)? If you work for a small business, an in-house retirement plan may not be available to you, since they can be very expensive to administer to just a small number of employees.

The good news, though, is that you have plenty of options for saving for retirement this year outside of a 401(k). Here are a few you can look at.

1. An IRA

The only thing you need to do to be able to contribute to an IRA is earn money. So whether you work for a company that doesn't have a 401(k) or you're a self-employed gig worker, you can contribute up to $7,000 of your earnings to an IRA this year if you're under 50, or up to $8,000 if you're 50 or older.

If you put your money into a traditional IRA, your contributions up to the aforementioned limits will shield that much income from taxes. In other words, if you contribute $3,000, the IRS won't tax $3,000 of your 2024 income. If you decide to save in a Roth IRA, your contributions won't go in on a pre-tax basis, but your investment gains and withdrawals will be tax free.

2. An HSA

A health savings account, or HSA, is technically an account you can use at any time to cover qualified medical expenses. So it can be argued that it is not a retirement account per se.

However, because HSA funds can be carried forward for as long as you want, you can treat your HSA as a retirement account. And it pays to do so, since healthcare is likely to be a large expense in retirement. This way, you'll have a separate pile of funds earmarked for that purpose.

HSA eligibility this year hinges on having a health plan with an individual deductible of $1,600 or more, or a family deductible of $3,200 or more. Your out-of-pocket maximum also needs to be capped at $8,050 if you have self-only coverage or $16,100 for family coverage.

If you're able to make HSA contributions this year, they max out at $3,850 for self-only coverage if you're under 55 or $4,850 for self-only coverage if you're 55 or older. If you have family coverage, the limit is $7,750 if you're under 55 or $8,750 if you're 55 or older.

3. A taxable brokerage account

A taxable brokerage account won't give you any tax breaks on your retirement savings. What it will give you, however, is flexibility.

With an IRA or 401(k), taking a withdrawal before age 59 1/2 could result in a 10% penalty unless you qualify for an exception. And there can be steep penalties for taking a non-medical HSA withdrawal.

A taxable brokerage account gives you access to your money at any time. It's actually a good idea to put at least some money into one of these accounts in case you end up in a position where you can retire early. And also, because there are no tax breaks associated with regular brokerage accounts, there's no annual contribution limit to worry about. You can invest as much money as you want.

A 401(k) isn't your only option for saving for retirement this year. Consider these other accounts if a 401(k) isn't available to you.