IRA vs 401k: Which One Is Actually Better for Your Situation?
Not all retirement accounts are the same. Explore IRA vs. 401K differences and how they impact your taxes and income.
Author: Brandon Jordan, CFP®, CHFC®, CEPA®, CVGA®, CLU®, MSA, EA | CEO of Impact Advisors Group
Every few years, the world reminds us that uncertainty isn’t theoretical. Markets dislike uncertainty. News cycles amplify it, and investors are left staring at headlines that seem to change by the hour.
Recently, geopolitical tensions have once again dominated the news. Whenever that happens, the same question inevitably comes up in conversations with clients:
“Should we be doing something different right now?”
My answer, more often than not, is simple, but not easy: “No”. This is exactly when discipline matters most.
If headlines were an investment strategy, we’d all be trading portfolios and changing business strategies every Tuesday afternoon. The challenge is that markets react to information much faster than investors can process it. By the time the average person decides to “get out until things calm down,” markets have already priced in the fear. Adding insult to injury, markets often recover while the news is still bad.
History has shown this repeatedly.
When markets reopened after the attacks of September 11th, 2001, fear was everywhere. No one knew what would happen next. The headlines were relentless. Many investors understandably wanted to pull their money out and wait for things to stabilize. However, within a few months, markets had already begun recovering. Those who sold during the panic often locked in losses and missed the rebound that followed. Those who stayed invested experienced something very different: the recovery.
The financial crisis of 2008 felt even worse at the time. Banks were failing, the housing market was collapsing, and it genuinely felt like the financial system itself might break. Many investors sold near the bottom because the headlines felt unbearable. But here’s the part that’s easy to forget now: the market didn’t hit bottom until March of 2009. From that point forward, markets began one of the longest recoveries in modern history. Investors who stayed disciplined were rewarded. Investors who reacted emotionally often spent years trying to recover from decisions made during a few months of fear.
Interestingly, business owners tend to understand this principle better than most investors. Imagine a business owner who built a company through the 2008 recession. Revenue declined, customers hesitated, and every news outlet predicted doom.
Yet the owners who stayed focused on fundamentals—serving customers, improving operations, and thinking long-term—often emerged stronger on the other side. I’ve personally seen business owners who doubled the value of their companies in the decade following that crisis. Not because conditions were easy, but because they stayed focused, disciplined, and chose NOT to panic.
We’ve also seen this play out with investors. One investor sells during uncertainty, waits for “things to feel better,” and then eventually reinvests after markets have already recovered. Another investor stays disciplined, follows the plan, and allows time to do the heavy lifting. Ten years later, the difference between those two outcomes can be enormous. Not because one investor was smarter, but because one investor was more disciplined and patient.
Let me be clear: staying the course doesn’t mean ignoring risk. It means building a plan, with multiple financial tools in our financial toolbox, that anticipates uncertainty—because uncertainty is inevitable—and then having the discipline to follow that plan when emotions run high. This is where long-term financial planning is the most IMPACTful. Not by predicting every headline, but by refusing to let headlines dictate our decisions. We strive to build balance sheets that can withstand most foreseeable circumstances, including uncertainty.
The purpose of a well-designed financial strategy isn’t to react to every event happening in the world. It’s to create enough clarity and resilience that when uncertainty arrives—as it always does—you already know what to do. Often the most productive action during turbulent periods is the least dramatic one: Stay disciplined, stay invested, and stay focused on the long term.
If the current headlines have you wondering whether your strategy is built to withstand uncertainty, we’re always happy to talk it through. Often, a brief conversation can provide the clarity and confidence needed to stay focused on what matters most.
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