Remember when checking your retirement account felt a little like playing the lottery—except the ticket cost you years of paychecks? Well, right now a whole lot of us are hitting the jackpot without buying a single extra ticket.
The latest numbers are almost hard to believe. Average 401(k) balances have climbed past $144,000. IRAs aren’t far behind. Even 403(b)s for teachers and nonprofit workers are flexing six-figure muscle. The market has been kind—very kind—and those automatic paycheck deductions we all set up years ago are finally looking like the brilliant move we hoped they’d be.
But here’s the thing that keeps me up at night when I think about my own money: good can always become great if you’re willing to take one extra step. And that step, my friend, is opening—or supercharging—an Individual Retirement Account alongside whatever your employer offers.
Why Your 401(k) Alone Isn’t Enough Anymore
Don’t get me wrong—maxing your 401(k), especially to grab the full employer match, is still rule number one. That match is literally free money, and anyone skipping it is volunteering to work extra years in retirement. Guilty as charged in my twenties, by the way.
Once that box is checked, though, the IRA becomes the secret weapon most people sleep on. You get more investment choices, usually lower fees, and—perhaps most importantly—the ability to keep building wealth even if you switch jobs or your company’s plan is mediocre.
In 2025 you can stuff up to $7,000 into IRA accounts ($8,000 if you’re 50 or older). That might sound small next to the $23,500 401(k) limit, but over decades that “small” snowball turns into a downright avalanche—especially when markets are cooperating like they are right now.
The Big Three Everyone Should Know
Three names keep rising to the top when savers ask where to park their IRA money. I’ve moved my own accounts between them over the years, and each has its sweet spot.
- Fidelity Investments – Zero minimum to start, no commissions on stocks or ETFs, and their robo-advisor (Fidelity Go) is free under $25,000. If you ever want to speak to a human without feeling nickel-and-dimed, they have branches everywhere.
- Charles Schwab – The king of customer service in my book. Their Intelligent Portfolios robo-advisor has no advisory fee (yes, really), and they still give you access to real CFP professionals when life gets complicated.
- Vanguard – The low-cost legend. If you’re the type who wants to own the entire market through rock-bottom-fee index funds and never look at it again, this is home.
I won’t pretend one is universally “best”—it depends on whether you want hand-holding, rock-bottom expenses, or somewhere in between. But any of the three will treat you better than most employer plans I’ve seen.
The Roth IRA Revolution Happening Right Now
Gen Z already figured this out—95% of their IRA contributions are going into Roth accounts. Smart kids.
Here’s the deal most people still don’t fully grasp: Traditional 401(k)s and IRAs give you a tax break today but tax you later. Roth versions flip the script—you pay tax now, then everything (growth included) comes out tax-free after 59½.
If you believe tax rates are going higher in the future—or that you’ll be in a higher bracket when you retire—a Roth is basically a license to print money.
Plus, Roth IRAs have this beautiful loophole: you can pull out your original contributions (not the gains) any time without penalty or tax. Bought a house? Had a baby? Needed to cover college? Roth lets you tap contributions without blowing up your retirement plan. Traditional accounts slap you with a 10% penalty plus taxes for the same move.
There are income limits, though. If you make too much, direct Roth contributions phase out. But there’s a backdoor anyone can use—Google “Backdoor Roth” when you’re ready; it’s 100% legal and financial advisors do it for high earners every day.
Let a Robot Do the Work: Best Robo-Advisors for IRAs
Confession: I love investing, but I also love not thinking about investing on Saturday mornings. That’s where robo-advisors shine.
They ask a few questions—how old you are, when you want the money, how much risk you can stomach—and then build, rebalance, and even harvest tax losses automatically. Most charge 0.25% or less per year. On a $100,000 account that’s $250. Pocket change for the time and headaches you save.
- Betterment – My personal favorite for goal-based investing. Want one bucket for a house down payment and another for retirement? Done.
- Wealthfront – Obsessed with tax optimization. Their tax-loss harvesting feature alone has saved me thousands over the years.
- Schwab Intelligent Portfolios – Zero advisory fee if you’re okay with them keeping a small cash allocation.
I still peek at my accounts (old habits die hard), but knowing everything is rebalanced and tax-optimized without me lifting a finger? That’s peace of mind money can buy.
Real Numbers: What an Extra $7,000 Per Year Actually Does
Let’s make this concrete. Say you’re 35 today and you start tossing the max $7,000 into a Roth IRA every year.
At a very realistic 8% average annual return:
- By age 50: roughly $171,000
- By age 60: about $493,000
- By age 65: closing in on $780,000—all tax-free
That’s from one decision you make this weekend—opening the account and setting up automatic contributions. The market will do the heavy lifting if you just show up.
The One Thing Smarter Than Starting Early
Starting today.
I talk to too many people in their fifties who say, “I wish I had known this at 30.” The second-best time to plantily plant that tree is right now. Markets are near all-time highs, yes—but they’ve been saying that for 15 years and anyone who waited for a dip is still waiting.
The people quietly building million-dollar Roth IRAs didn’t try to time anything. They just kept buying through every headline, every dip, every euphoric rally. And right now their statements are proof it works.
Your 401(k) is doing great. Celebrate that win. Then ask yourself: why settle for great when legendary is still on the table?
Open the IRA. Pick your provider. Set the transfer for the 15th of every month. Thank me in twenty years when “retirement” starts feeling less like a dream and more like the best chapter you haven’t written yet.
