Retirement Basics & Terms
The period of life after ending a working or professional career.
What is retirement?
This plan is an employer-sponsored retirement plan that allows an individual to deposit part of each paycheck into a tax-deferred investment.
What is a 401(k) plan?
This individual retirement arrangement allows for tax-deductible contributions, but withdrawals are taxed in retirement.
What is a Traditional IRA?
The process of moving retirement savings from one qualified account to another without penalty.
What is a rollover?
This plan is available to employees of nonprofit organizations, such as schools and hospitals.
What is a 403(b) plan?
This personal account allows after-tax contributions and qualified withdrawals are not taxed, and it has no RMD rules.
What is a Roth IRA?
This is the process of determining when money set aside in a retirement plan legally belongs to an employee.
What is vesting?
This plan receives contributions made with after-tax earnings, but withdrawals are not taxed.
What is a Roth 401(k)?
The contract with an insurance company that provides regular income for a set period of time, often for life.
What is an annuity?
The minimum amount that must be withdrawn each year from most tax-deferred retirement accounts, typically starting at age 72.
What is the Required Minimum Distribution (RMD)?
This defined-contribution plan for government employees uniquely does not penalize early withdrawals or have RMD rules.
What is a 457 plan?
This federal governmental pension plan is based on payments an individual makes throughout their working years.
What is Social Security?
This is a retirement plan, also known as a pension plan, that makes regular payments to a retiree until death.
What is a defined-benefit plan?
Name the two general categories of employer-sponsored retirement plans.
What are defined-benefit and defined-contribution plans?
Name two of the specific retirement plans available to a person who is self-employed.
What are SEP-IRA, Solo 401(k), or SIMPLE IRA?Export to Sheets