A 401k is a retirement plan set up by your employer. You redirect a percentage of your salary to this plan on either a pre-tax or post-tax basis. Many companies offer a match where they will add the same amount to your 401k as you add. This money is also invested for you so it will increase even more over time, before you touch it at retirement.
An IRA is an Individual Retirement Account, which is similar to a savings account with certain tax breaks in order to incentivise saving for retirement. These are typically opened up on your own, or by a small business, rather than a larger employer, like the 401k. These are typically set up through investment firms that will choose a combination of stocks, bonds and other assets in which to invest your money.
Traditional IRAs mean you invest money before it’s taxed, and all taxes are deferred until you take the money out at retirement. You don’t have to pay taxes as you earn interest, which allows your account to grow quickly.
SIMPLE IRA stands for Savings Incentive Match Plan for Employees. It’s basically a traditional IRA that include a company match of your investments.
SEP IRAs are like traditional IRAs but to open one you need to own a business with at least one employee, or have freelance income. Contributions are tax-deductible, and go into an account for their employee, but the employee is not allowed to contribute.
Roth IRAs use money after it’s already been taxed, so you don’t pay any taxes as you make money or when you take it out at retirement.