Q: How do I choose between a 401(k) plan and an IRA?

A: You don't necessarily have to make a choice, since you are permitted to invest in both an 401(k) and an IRA, subject to limits on the amount of your contributions to each plan.

Most investors should contribute the minimum amount to their 401(k) required to trigger the maximum employer match.

Once you have maxed out your 401(k), consider a Roth IRA.

While contributions to a Roth IRA are not tax deductible, there is no penalty for early withdrawals up to the amount contributed, and no tax on investment earnings once you reach age 59 ½.

This story is more about saving than investing. If your net worth is less than $10,000, you need to save, save and save some more! Future articles will address larger sums.

I have been asked many times in person and in the comments section about how to get started as an investor. Since it is essential to have something to invest besides your time, two things above all are required: Educate yourself, and be thrifty in your spending habits.

Most people reading the AOL Money & Finance section probably have ten grand to invest. If you do not currently have $10,000 to invest you are in trouble and there is no time to waste.

First: Reduce spending on extras, even extras you think you need to live.

Everyone knows that sex sells. That does not take much convincing. Why? Because we have a built-in mechanism that compels us every day, and through every week, month and year to at least take notice. The word in the blog title is a case in point. It probably piqued your interest in reading this, and I took advantage of that. Year in and year out sex sells. Well, the same can be said about stock dividends.

Dividends assure some return on your investment day by day, year after year, in up and down markets. The compounding of these dividends over time adds a burst of upside that is significant in the long run and this has been well documented. The Motley Fool talks about how dividends are powerful and that Wharton finance guru Jeremy Siegel agrees.

So following up on the importance of making a return on capital investments I thought I would add another historic consideration in value investing with a personal example. In my Roth IRA I am conducting a non-scientific experiment.