How Many Bank Accounts Should I Have?

2. Individual retirement account (IRA)

As mentioned above, if your employer does not offer a 401(k), then you’ll want to set up an IRA account.

A 401(k) is employer-sponsored whereas an IRA can be opened by an individual. Both offer tax advantages but the 401(k) includes other perks such as the employer match on contributions.

One of the main advantages of an IRA is that it offers you a wide range of investment options so you can work with a financial advisor to choose the optimal mix for your needs.