A 401k savings plan is a great way to save for retirement. It can allow you to save a portion of your pay before taxes are taken out (subject to federal limits). Some companies, like mine, can match portion of your savings dollar-for-dollar, up to a certain percentage, (4 percent with my own employer). This can be a reasonably painless way to save since a small amount of your salary can be deducted each pay period to where the dollars may be of little notice. To top things off, you don’t have to pay taxes on this money while it is being vested, only paying taxes on it as you take it out when you spend it when Income could be lower than the peak of your career earnings. This allows you to limit the amount of the money that is taxed since you will have control over how much you withdrawal/spend keeping yourself in a lower tax margins.