How to Max Out Your Retirement Accounts in 2014

Use these strategies to make optimum use of your 401(k) and IRA.

 Woman Placing a Quarter in Her Piggy Bank.
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Get the saver's credit. There's an extra retirement saving tax perk for low- and moderate-income workers who save for retirement. Couples with an adjusted gross income of less than $60,000 ($30,000 for individuals) who save for retirement in a 401(k) or IRA are eligible to claim the saver's credit on their tax return, which can be worth as much as $1,000 for individuals and $2,000 for couples.

Choose low-cost investments. One of the ways money leaks out of your 401(k) or IRA is when you pay high fees on your investments. Choosing low-cost investments will help your money grow faster. "Become really astute in terms of the fees that are being charged in the investments in your plan," Zandlo says. "Even if you are able to save half a percent, over 10 years, that is 5 percent of your money."

Hold high-tax investments in retirement accounts. When you withdraw money from a traditional retirement account, it will be taxed at regular income tax rates, regardless of what the money was invested in. If you are saving in both retirement and taxable accounts, it makes sense to hold investments that are taxed at a low rate outside your retirement account and investments that are taxed at a higher rate within the retirement account.

[Read: 10 Retirement Resolutions for 2014.]

Don't take the money out too early or too late. Traditional 401(k)s and IRAs have a variety of rules about when money can and should be withdrawn from the account. Withdrawals from traditional retirement accounts before age 59 1/2 typically result in a 10 percent early withdrawal penalty in addition to regular income tax on the amount withdrawn. However, there are some exceptions to the early withdrawal penalty if an IRA distribution is used for higher education costs, a first home purchase (up to $10,000), high medicals costs or health insurance expenses after a period of unemployment. After you turn age 70 1/2, withdrawals from traditional retirement accounts become required. The penalty for missing a withdrawal is 50 percent of the amount that should have been withdrawn.