Money Framework
Investment Order of Operations
Six steps. Every dollar has a home. Follow the sequence and you'll never leave money on the table.
The Speedrun Take
Most people contribute randomly — a bit here, a bit there. The order matters because each account type has a different tax advantage. Skipping the employer match is the most expensive mistake in personal finance. Follow this sequence and you capture every advantage in priority order.
The Order of Operations
Your employer matches 50-100% of your contributions up to a cap. That's an instant 50-100% return — nothing else comes close.
Even a 50% match is a guaranteed 50% return before any market gain.
Action: Contribute exactly enough to get the full match. Not a dollar less.
Contributions pre-tax, growth tax-free, withdrawals tax-free for medical. The only triple-tax-advantaged account that exists.
Must have a qualifying HDHP. Limits 2024: $4,150 single / $8,300 family. After 65: works like a Traditional IRA.
Action: Skip if you don't have an HDHP. Don't get a worse health plan just for the HSA.
Contributions are after-tax, but every dollar of growth is yours tax-free at retirement. No required minimum distributions.
Limit 2024: $7,000/year ($8,000 if 50+). Phase out $146k–$161k single / $230k–$240k married.
Action: Best fund: FZROX at Fidelity — 0.00% expense ratio inside a Roth = zero cost on tax-free growth. Above income limit? Look into the Backdoor Roth IRA.
After maxing the Roth IRA, go back to the 401k. Pre-tax contributions reduce your taxable income this year.
Limit 2024: $23,000/year ($30,500 if 50+).
Action: Choose Roth 401k option if your plan offers it and you expect to be in a higher bracket in retirement.
No contribution limits, no restrictions on withdrawals. Buy VTI or FZROX and hold. Subject to capital gains tax on growth.
Best for: after maxing all tax-advantaged accounts, or if you need access before retirement age.
Action: Open at Fidelity.
529 for college savings. I-Bonds for inflation hedge. Paying off high-interest debt (>7% APR) should happen before step 2.
These are situational — apply based on your specific goals.
Open Fidelity for Your Roth IRA + Taxable Brokerage
FZROX at 0.00% expense ratio covers steps 3 and 5 of the order — no account minimum, no fees.
What About High-Interest Debt?
If you have debt over ~7% APR — credit cards, personal loans — pay that off before step 2. Paying off 20% APR debt is a guaranteed 20% return, better than any investment.
Pay off first (>7% APR)
- →Credit cards (15–30% APR)
- →Personal loans (>7%)
- →Auto loans (>7%)
Invest simultaneously (<7% APR)
- →Mortgages (3–6%)
- →Subsidized student loans
- →Low-rate auto loans
The threshold: guaranteed debt return > expected market return (~8–10%). Roughly 7–8% is the crossover. Below that, the math favors investing.
The Math Behind the Order
Why every step outperforms the one after it.
Employer Match
50%
Instant return on your contribution before the market does anything. A 50% match on your 6% contribution means $1 in becomes $1.50 — immediately.
HSA Triple Tax
$1.28
At 22% federal tax rate, $1 of HSA contribution = $1.28 effective after-tax value. Save pre-tax, grow tax-free, spend tax-free on medical.
Roth IRA (30 years)
$788k
$7,000/year for 30 years at 8% growth = ~$788,000 — all of it yours tax-free. The IRS never touches it again.
401k (same math)
Taxable
Same growth potential as the Roth, but withdrawals are taxed as ordinary income. Still powerful — just less so than Roth at lower income brackets.
Your 2024 Contribution Targets
| Account | 2024 Limit | Priority |
|---|---|---|
| 401k (to match) | Varies | 1st |
| HSA | $4,150 / $8,300 | 2nd |
| Roth IRA | $7,000 | 3rd |
| 401k (full) | $23,000 | 4th |
| Taxable | Unlimited | 5th |
Related
Start the Stack
Open Fidelity — Build Your Stack
Fidelity is where you open your Roth IRA, HSA, and taxable brokerage. FZROX at 0% expense ratio covers all three accounts. Best platform for following this order of operations.