What Is The Difference Between A 401K And An IRA? 
The biggest difference between a 401 -LRB- k -RRB- and an IRA is how much you can contribute to the accounts . With the 401 -LRB- k -RRB- , if you are under 50 , you can contribute up to $ 17,500 plus employer matches if they are available while the IRA is limited to $ 5,500 -LRB- under age 50 -RRB- . If you are older than 50 , the limits are increased a bit . Both accounts are tax-deferred , designed to be used during retirement , over age 59 1/2 otherwise penalties will be charged . 