You invest in an IRA or 401k to get the long term tax savings and have money when you retire, not because you might get a couple hundred dollars of a saver's credit from the feds. The first question is, do you want to invest some more money for retirement? (Knowing that there are limits on withdrawing it before retirement)?
If you do want to invest more money for retirement than you already have, the next issue is that the 401k contribution rules and IRA contribution rules are different and don't add or subtract from each other. The contribution limit for any kind of IRA is $7500 if you are under age 50. It doesn't matter if you already contributed $10 or $10,000 to your 401k.
The third issue is that if you were covered by a workplace plan for even one pay period in 2025, then you follow the IRA rules for someone who is "covered" by a plan, even if your plan was not maxed out.
There are three ways you can contribute to an IRA.
- Traditional IRA pre-tax (deductible)
- Traditional IRA after-tax (non-deductible)
- Roth IRA (non-deductible)
At your income, you are probably disallowed from making a deductible contribution to a traditional IRA, but you should be eligible to contribute non-deductible funds to a traditional IRA or to a Roth IRA. For several reasons, the Roth IRA is preferred if you are eligible. Mixing pre-tax (deductible) and after-tax (non-deductible) contributions in a traditional IRA has some complications and paperwork issues that you need to know about. Instead, if you already made a non-deductible contribution to a traditional IRA, you could reverse that and contribute to a Roth instead (that is called recharacterizing, and you would have your broker do that for you). Then you could contribute additional funds directly to the Roth IRA.
