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What are the main differences between a 401(k) and a IRA?
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The main difference between a 401(k) and an IRA is that a 401(k) is offered through an employer, while an IRA can be opened with any financial institution or broker. A 401(k) typically offers more investment options than an IRA, such as stocks, bonds, mutual funds, and annuities. Withdrawals from a 401(k) are taxed differently than withdrawals from an IRA, so it's important to understand the tax implications before making decisions about which type of retirement account to open.