The 401(k) and IRA Maximum Contribution Limits for 2021
There are several tax benefits associated with saving in an IRA or 401(k). With a traditional IRA or 401(k), your contributions go in tax-free, thereby exempting a portion of your income from taxes. Traditional IRAs and 401(k)s also allow for tax-deferred investment growth, which means that when your investments in your account earn money, you're not taxed on those gains year after year like you are in a regular brokerage account.