BEYOND THE 401(K): OTHER WAYS TO SAVE FOR RETIREMENT
According to a recent USA TODAY article, No 401(k)? CDs, IRAs and HSAs can still help you save, a 401(k) is a powerful retirement savings tool, but it’s not the only one. Whether your employer doesn’t offer a plan, you’re already maxing yours out, or you simply want more options, there are other vehicles worth knowing about.
CDs: Steady and Simple
A certificate of deposit, or CD, is a savings product offered by banks and credit unions that provides fixed interest rates and guaranteed returns. As of May 2026, competitive rates above 4% are available for those willing to shop around. CDs are FDIC or NCUA insured up to $250,000, carry no maintenance fees, and offer terms ranging from three months to 10 years.
One popular strategy is building a CD ladder by opening multiple accounts with staggered maturity dates to keep regular access to your funds.
Early withdrawal penalties typically apply if funds are accessed before maturity. Confirm penalty terms with your bank before opening.
Traditional IRA: A Flexible Alternative
A traditional IRA is one of the strongest alternatives to a 401(k), particularly for the self-employed, small business employees, or anyone looking to diversify beyond workplace plans. Contributions may be tax-deductible, and investments may also grow tax-deferred until retirement.
Be aware that the ability to deduct traditional IRA contributions may be limited or eliminated if you or your spouse participates in a workplace retirement plan and your income exceeds IRS thresholds. Consult a tax professional for guidance.
For 2026, the contribution limit is $7,500 for those under 50, and $8,600 for those 50 and older.
Traditional IRA withdrawals before age 59½ may be subject to a 10% penalty plus ordinary income taxes. Required minimum distributions must begin at age 73.
HSA: The Triple Tax Advantage
If you have a high-deductible health plan, you may be eligible for a health savings account, and it’s worth a close look. Contributions are tax-deductible, growth is tax-free, and withdrawals for qualified medical expenses are also tax-free. After age 65, funds can be used for any purpose.
However, non-medical withdrawals are subject to ordinary income tax, like a traditional IRA. Withdrawals for qualified medical expenses remain tax-free at any age.
HSA contributions are not permitted after Medicare enrollment begins.
For 2026, the HSA contribution limit is $4,400 for self-only coverage and $8,750 for family coverage. Adults 55 and older may contribute an additional $1,000. Limits are adjusted annually, so verify current amounts at IRS.gov.
Knowing your options is the first step toward making the most of every dollar you save.
