I just realized that we may not have a shared understanding of investment accounts. Let's call stocks, bonds and mutual funds "investments". (There are obviously many other types of investments, but for the sake of simplicity, that's all we'll talk about here). Investment accounts are the types of accounts that allow you to invest in the market. They are accounts that hold your investments, they are not the investments themselves. Here are my top three investment account types:
Sometimes called a taxable brokerage account or a non-retirement account
Provides access to a broad range of investments, including stocks, mutual funds, bonds, etc. Anyone can open up a brokerage account to invest in the stock market, there are no limits on how much money you can contribute and money can be withdrawn at any time. However, all of the earnings from these accounts are taxable. Fidelity and Vanguard offer low-cost brokerage accounts.
Employer-Sponsored Retirement Plans
401(k), 403(b), 457, Thrift Savings Plans - these may come as "Traditional" or "Roth"
Employer-sponsored retirement accounts allow employees to contribute a portion of their salary to plans set up by their employers, who often contribute a matching amount based on a predetermined formula. In employer sponsored accounts, employers pick the investment options available to you — typically a range of mutual funds.
Individual Retirement Account (IRA)
An individual retirement account, is a standard brokerage account with access to the same range of investments. The biggest difference between a retirement account and a brokerage account is how the IRS taxes — or doesn’t tax — contributions, investment gains and withdrawals. Brokers also offer specialty retirement savings accounts for small-business owners and self-employed individuals, such as SEP IRAs, SIMPLE IRAs and Solo 401(k)s. Fidelity and Vanguard offer low-cost IRAs.