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Defined Contribution Plan Definition

A defined contribution plan is a form of retirement savings that offers a tax-advantaged account for employees to contribute to. This can be done individually or with the help of their employer. Contributions and growth within the account are typically tax-free until withdrawal, with the exception of Roth options. This means that in defined contribution plans, the responsibility for investment risks and potential gains lies with the employee, not the employer. While some employers may offer matching contributions, the final decision to invest ultimately rests with the employee.

Individual Retirement Accounts (IRAs)

An important aspect of personal finance is understanding retirement planning. One such option is the Individual Retirement Account (IRA), which offers various benefits such ...

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Annuity

An annuity involves an investor providing cash to a vendor, typically an insurance company, in return for the promise of a series of periodic payments. These payments can be...

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Diversification

Diversification in finance refers to the practice of minimizing risk by investing in a variety of industries or companies rather than focusing on a single industry or a smal...

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Life Expectancy

Life expectancy refers to the estimated duration of an individual's life. Interestingly, a person can have multiple life expectancies depending on various factors. For insta...

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