Your first adult job sprouts a new round of firsts, including your first adult paycheck. Ideally, that paycheck will sprout your first investment account. Here are five great investment options to get off on the right start, in very particular order:

A 401(k) with matching dollars

Contributions to a traditional 401(k) come out of your paycheck pretax, which means you don’t pay taxes on that money … now. You will be taxed instead when you take distributions from the account in retirement. Tax perks like this are common in retirement plans, but there are two unique factors that land the 401(k) in the top spot: a high annual contribution limit of $18,500, and employer matching dollars.

An emergency fund

Let’s call it an investment in yourself — it’s pretty key to financial stability, which makes it worth a mention here. You might or might not have heard this rule: Keep three to six months’ worth of expenses stashed in a savings account. That’s great, if you can swing it. If not, new rule: $500 or $1,000 will float you through most emergencies. You can add more once you are steadily investing elsewhere.

A Roth IRA

If your employer doesn’t offer a 401(k) plan, your next best option is probably a Roth IRA.

You can contribute up to $5,500 per year, and contributions are made after-tax, so distributions in retirement are tax-free. That kind of arrangement is ideal for someone just out of college, because you are locking in your current relatively low tax rate.

A traditional IRA

One downside of the Roth IRA: To make the full contribution, your modified adjusted gross income as a single tax filer must be less than $120,000. Needless to say, the salary of most new workers falls well below that boundary. If yours doesn’t? Drinks on you! And also, you should consider a traditional IRA instead. The traditional IRA follows the standard 401(k) format.

 

A taxable brokerage account

This is essentially a savings account you can use to trade stocks or buy mutual funds. It’s where you can continue investing once you have maxed out retirement accounts, or if you would like to invest for nonretirement goals like a house, a wedding or avocado toast. You can open this account at an online brokerage, if you want to get your hands dirty picking and choosing investments, or at a robo-adviser.

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