Retirement Planning
A 401(k) plan is a tax-deferred salary savings plan that companies can offer their employees as a retirement account. A 401(k) plan meets the tax-deferral requirements of Section 401(k) of the IRS t...
A 403(b), commonly referred to as a Tax-Deferred Annuity (TDA) or Tax-Sheltered Annuity (TSA) plan, is a retirement savings plan available to employees of certain public education organizations, non-...
AARP stands for the American Association of Retired Persons. It is a nonprofit organization that advocates and promotes the well-being of Americans 50 years of age or older. With roughly 40 million...
In the finance world, an advisor (also spelled adviser) is an educated investment professional who helps people and businesses set and meet long-term financial goals. An advisor is similar to an inv...
A blackout period is a time period of roughly 60 days during which a company's employees are unable to make changes to their savings or retirement plans. Nearly every organization offers employees n...
CalPERS is the abbreviation for the California Public Employees' Retirement System. It is the nation's largest pension fund. The state of California is one of the nation's largest economies. More th...
A dark pool is trading activity that occurs directly between parties without the use of an exchange, thereby keeping the transactions private. Institutions usually create dark pools. Let’s assume ...
A deferred stock purchase plan is an uncapped stock contribution with an employer matching the contribution that vests as the employee provides additional service during a deferral period.  In a de...
A defined benefit plan is a qualified retirement account that contractually agrees to pay a specified benefit at the plan holder's age of retirement. This type of qualified plan clearly defines the a...
In general, a defined contribution plan is a tax-deferred savings plan that people fund with their own money (rather than an employer) and use to save for retirement. It is the opposite of a defined ...
The Employee Benefits Security Administration (EBSA) is the branch of the United States Department of Labor responsible for overseeing the administration and planning of employee pension funds by com...
An employee contribution plan is an employer-sponsored retirement plan where employees deposit (contribute) their own money to a special account. Employee contribution plans are usually funded by co...
Th Employee Retirement Income Security Act of 1974 (ERISA) is an American federal statute that protects the retirement assets of Americans by establishing a set of rules that must be followed by fid...
Graduated vesting occurs when a financial instrument or account becomes wholly owned by an investor over time. Let's assume John Doe is eligible to participate in his company's 401(k) plan. The comp...
A hardship withdrawal is a premature withdrawal of money from a retirement account on account of special circumstances. Retirement plans -- for example, 401(k)s and IRAs -- have special tax treatmen...
An Individual Retirement Account (IRA) is a government sponsored, tax-deferred personal retirement plan.  An IRA can also be referred to as a Traditional IRA. In order to open an IRA, an individual...
A joint and survivor annuity is an annuity with two named beneficiaries. The annuity provides both beneficiaries with recurring income for life. Joint and survivor annuities, as the name suggests, s...
A Keogh Plan is a tax-deferred retirement plan available to self-employed individuals or unincorporated businesses. Congress passed legislation called the Self Employed Individuals Tax Retirement Act...
Liability matching is an investing strategy for investors who need to fund a series of future liabilities. Buy-and-hold and indexing strategies are about generating steady rates of return in a portf...
The term matching contribution refers to a matching dollar amount contributed by an employer to the retirement savings account of an employee who makes a similar contribution, usually to a 401(k) ...
Medicaid is a U.S. government program that provides free or low-cost health insurance coverage for low-income people. Enacted in 1965, Medicaid is funded by states, which receive matching funds from...
A non-qualified plan is a retirement plan to which the IRS does not grant specific tax benefits. A non-qualified retirement plan is essentially whatever a qualified plan is not. In other words, if t...
A qualified automatic contribution arrangement (QACA) is a way to automatically enroll employees in a defined contribution plan like a 401(k).  For example, assume that you get a new job with an em...
A qualified distribution refers to a tax and penalty-free withdrawal from a Roth IRA. A qualified distribution must meet two main requirements. First, it must occur at least five years after the Rot...
A qualified reservist is a member of the military reserves who is eligible to make an early withdrawal from an individual retirement account (IRA). For example, let's assume that John is a 28-year-o...
A qualified retirement plan is a plan to which the IRS grants specific tax benefits. The myriad of exact requirements for qualified retirement plans are in the Internal Revenue Code section 401(a) a...
A qualifying investment is a contribution to a retirement plan made with pre-tax income. For example, let's assume that John participates in his company's 401(k) plan. He socks away $200 per month, ...
A Roth IRA is a type of Individual Retirement Account (IRA) for individuals who fall below certain income thresholds. One of the primary benefits to investing in a Roth IRA is that distributions ar...
The Savings Incentive Match Plan for Employees of Small Employers (SIMPLE) is a salary savings plan that small companies can offer their employees. The plan allows employers to match their employees'...
A simplified employee pension (SEP) is a type of individual retirement account (IRA) that can be opened by an employer on behalf of an employee or by a self-employed individual. It may also be known ...
Social security is a federal program that provides income and health insurance to retired persons, the disabled, the poor, and other groups. The program started in 1935 with the signing of the Social...
A tax-deferred annuity (TDA), commonly referred to as a tax-sheltered annuity (TSA) plan or a 403(b) retirement plan, is a retirement savings plan available to employees of certain public education o...
A tax-deferred savings plan is an account that allows the account holder to postpone paying taxes on the investments in the account. A 401(k) plan is the most common example of a tax-deferred saving...
In Canada, a tax-free savings account (TFSA) is a federal program that allows Canadians to avoid paying taxes on interest earned in specific savings accounts. Canadians with valid Canadian Social In...
A tax-sheltered annuity (TSA), also referred to as a tax-deferred annuity (TDA) plan or a 403(b) retirement plan, is a retirement savings plan for employees of certain public education organizations,...
A withdrawal penalty occurs when a depositor or investor withdraws funds from an account before an agreed-upon withdrawal date for disallowed purposes or in a disallowed manner. Individual retiremen...
A year's maximum pensionable earnings is what the Canadian government uses to determine the maximum amount a person can get from the Canada Pension Plan. The Canada Pension Plan is similar to the So...