Do you really need a retirement account? Definitely. You'd benefit from multiple.
To the nay-sayers, I plan to live well beyond my 70s, 80s, and 90s. Even if we can't count on social security, I am preparing for a long and lucrative life. I encourage you to still plan for retirement on your own, and compound interest is the key.
The standard retirement accounts are:
I have a Roth and 401k.
A 401k is an employer provided pension account, and many companies offer a contribution match. If you can open one, contribute no higher than the full match. The match is free money (so take that) but all withdrawals will be taxed.
A Roth IRA allows you to contribute money which has already been taxed. You're able to withdraw your contributions tax and penalty free at any time. Earnings can be withdrawn tax-free once you hit retirement age.
With a traditional IRA, earnings will be taxed upon withdrawal in retirement. Since taxes tend to increase over time, I favor the Roth. There is the argument that those retiring will be in a lower tax bracket, so it's to your discretion which IRA is better for you.
With IRAs, if you are under 50 you can contribute up to $6,000 per year, and up to $7,000 if you are over 50. Max it out every year if you can. If you missed the previous year you can max that out as well, so long as you do so before the April tax deadline.
Please note that once your money moves from your bank to these accounts, you do need to select where the money is invested (index, individual, etc.) or else it will just sit there doing nothing.
Click here for a side-by-side tool to help you decide which retirement fund suits you best.
Do you have a preference?