It depends, what are you investing for? 401k is a great way to invest for your retirement. However, many also start a taxable investment account if they are investing and saving for shorter goals, such as buying a house. There are college funds available for those who'd like to plan ahead for their children's education.
Generally though, you should max out your employer's matching contribution, if any. Also, with a 401k, the investment options may be limited. Many investors choose to set up an IRA account to be able to access more investment options with possibly lower fees.
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