Where to put $5,000 now

If you're already earning the full employer match in your401(k), seek the shelter of a Roth.

Unlike with a 401(k), you get no tax break on the dollars you put into a Roth, but you get to withdraw all your earnings tax-free when you retire (maximum 2007 contribution: $4,000 or $5,000 if you're 50 or older; income limits apply). It's a great hedge against higher taxes in the future.

To make saving easy, open a Roth at a brokerage or mutual fund and authorize it to withdraw $333 automatically from your savings or checking account every month for a year.

$4,000 in a Roth today equals $18,644 in 20 years (assuming an 8 percent annual return).