The primary advantage of a 401k is that contributions are deducted from your taxable income.
If you make $100,000 and put 10% of that into a 401k, your income tax will be based on a $90,000 income.
You do pay taxes on the money you put into a 401k when you start withdrawing from it during retirement, but what matters is this: if you believe your income during retirement (i.e. the money you'll be paid regularly out of your retirement accounts) will be less than your income today, then contributing to a 401k means you will end up paying a lot less in taxes overall, over the course of your life.
There are ways to take money out of your retirement accounts before retirement age, but it depends on certain scenarios[1]. If you need to access the money before retirement age outside of those scenarios, then do a regular brokerage account.
Regardless though, you should definitely open a Roth IRA if you're eligible, and contribute the maximum amount every year. Contributions to your Roth IRA are after-tax, so they won't be taxed when you take them out during retirement - since they have already been taxed. This makes them very advantageous.
If you plan on staying a us resident, that is. Several cross-national taxation agreements (Germany, Austria at least), don't have double-taxation avoidance for roth type accounts.
If you make $100,000 and put 10% of that into a 401k, your income tax will be based on a $90,000 income.
You do pay taxes on the money you put into a 401k when you start withdrawing from it during retirement, but what matters is this: if you believe your income during retirement (i.e. the money you'll be paid regularly out of your retirement accounts) will be less than your income today, then contributing to a 401k means you will end up paying a lot less in taxes overall, over the course of your life.
There are ways to take money out of your retirement accounts before retirement age, but it depends on certain scenarios[1]. If you need to access the money before retirement age outside of those scenarios, then do a regular brokerage account.
Regardless though, you should definitely open a Roth IRA if you're eligible, and contribute the maximum amount every year. Contributions to your Roth IRA are after-tax, so they won't be taxed when you take them out during retirement - since they have already been taxed. This makes them very advantageous.
[1]http://www.bankonyourself.com/401k-withdrawal-rules