Short answer: for most beginners in the US, a common order is: a $1,000 starter emergency fund, enough in your 401(k) to get the full employer match, pay off high-interest debt, finish your emergency fund, an HSA if you're eligible, a Roth or Traditional IRA, more in your 401(k) toward the limit, then a taxable brokerage account. It's a general framework, not personal advice, but it fits a lot of people.
The order of operations
- Starter emergency fund ($1,000+). Keep it in a high-interest savings account so a surprise bill doesn't go on a credit card.
- Get your full 401(k) match. If your employer matches contributions, that's an instant return you won't get anywhere else.
- Pay off high-interest debt. Credit cards and anything around 8% or more.
- Finish your emergency fund. Three to six months of essential expenses.
- HSA, if you're eligible. Requires an HSA-eligible high-deductible health plan.
- Roth or Traditional IRA.
- Increase 401(k) contributions toward the yearly limit.
- Taxable brokerage account for anything extra.
2026 contribution limits
| Account | 2026 limit | Tax break |
|---|---|---|
| 401(k) / 403(b) | $24,500 (+$8,000 at 50+, or +$11,250 instead at ages 60 to 63) | Traditional: deduct now, taxed later. Roth 401(k): taxed now, tax-free later. |
| IRA (Roth + Traditional combined) | $7,500 (+$1,100 at 50+) | Roth: tax-free growth and withdrawals in retirement. Traditional: may be deductible. |
| HSA | $4,400 self-only / $8,750 family (+$1,000 at 55+) | Deductible in, tax-free growth, tax-free out for medical costs |
| Taxable brokerage | No limit | None upfront; long-term gains taxed at lower rates |
Employer matches don't count toward your own 401(k) limit. Direct Roth IRA contributions phase out at a modified AGI of $153,000 to $168,000 (single) and $242,000 to $252,000 (married filing jointly) in 2026.
Why the HSA ranks so high
The HSA is the only account that's tax-deductible going in, grows tax-free, and comes out tax-free for qualified medical costs. Many HSAs hold your money as cash by default, so choose investments inside it if you're investing for the long term.
Roth or Traditional?
If you expect your tax rate to be higher in retirement than it is today, Roth is usually the better fit, which is common early in a career. If your tax rate is high now, Traditional's deduction can be worth more. Roth IRA contributions (not earnings) can be withdrawn any time without tax or penalty, which gives you some flexibility.
Example: Maya, 26
Maya earns $58,000 and her employer matches 50% of the first 6% she puts in her 401(k). She saves a $1,000 starter fund, contributes 6% to get the full match, pays off a $2,400 credit card, builds a three-month emergency fund, then opens a Roth IRA and automates a target-date index fund. Once she's through those steps she invests $735 a month including the match. Kept up until 65 at a hypothetical 7%, that's roughly $1.4 million. Hypothetical example for illustration only; returns aren't guaranteed and can be negative.
Common questions
What should I buy inside my 401(k) or IRA?
Many beginners use a low-fee index fund or a target-date fund, which spreads your money across thousands of companies. Check the expense ratio: the difference between 0.2% and 2% in fees can add up to tens of thousands of dollars over a few decades.
What are the 2026 deadlines?
401(k) contributions must come out of 2026 paychecks by December 31, 2026. IRA and HSA contributions for 2026 can be made until the tax filing deadline in April 2027.
Do I need a lot of money to start?
No. Many brokerages let you buy a fund with as little as $10, and setting up an automatic monthly contribution matters more than the starting amount.
The full plan
The Investing Starter Guide, US Edition 2026 covers each account, what to buy, how to place your first order and a 30-day plan. The US Starter Kit adds a Portfolio Tracker that tracks your 401(k), IRA and HSA room for you.
Educational content only, not financial, tax or legal advice. Limits are 2026 figures; confirm current numbers with the IRS (irs.gov).