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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.

Life Annuity Payment Option

An annuity offers various payment options to an annuitant, one of which is the life annuity option. This option guarantees payments for the duration of the owner's life, but...

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Employer-sponsored Retirement Plan

Let's delve into the world of retirement planning and explore the difference between Defined Contribution and Defined Benefit plans. These types of plans are widely used, wi...

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Target Date Fund

A target date fund is a type of mutual fund that adjusts its risk level based on the investor's target date, usually their estimated retirement date. This is achieved by gra...

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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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