Can I have both a 401k and an IRA?

Can I have both a 401k and an IRA?

Answer: Yes, you can have both a 401k and an individual retirement account (IRA) at the same time. In fact, it is quite common to have both types of accounts. The plans share similarities in that they offer the opportunity for tax-deferred savings, or in the case of the Roth 401(k) or Roth IRA, tax-free savings. However, depending on your  situation, you may not be eligible for tax-advantaged contributions to both of these accounts in any given tax year.

If you (or your spouse, if you’re married) have a retirement plan at work, your tax deduction for a traditional IRA may be limited – or you may not be entitled to a deduction – depending on your modified adjusted gross income (MAGI). Click here for an IRS chart to tell you where you stand