The One Big Problem With IRAs
According to Gallup, approximately 6 in 10 Americans have money invested in a retirement savings plan, including 401(k)s, 403(b)s, and the ever-popular individual retirement account (IRA). While IRAs are terrific retirement plans, they're not perfect. Specifically, low contribution limits can make it tough to sock away as much as you need to each year.
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The annual contribution limit for an IRA in 2025 is $7,000, with a catch-up contribution for individuals 50 and over of $1,000. That means the most you can contribute to an IRA is $8,000. While that's nothing to sneeze at, it doesn't come close to the amount you can put into a retirement plan like a 401(k). With an employer-sponsored 401(k), you can invest as much as $23,500 into your plan, not counting any funds your employer contributes.
Source Fool.com
