Types Of Retirement Accounts

Question 1

• A special type of account designation put on a custody account that gives it some incredible tax benefits
• Money contributed here comes from after-tax dollars (You do not receive a tax deduction)
• As long as you follow the rules you will never pay taxes on any of the profits, you generate from the investments held within this account nor when you withdraw those profits
• You can buy stocks, bonds, real estate, certificates of deposit and other asset types within this type of account

Answer 1

Roth IRA

Question 2

• The earliest type of IRA. Investors can contribute money to it if they meet certain qualifications, such as their total income.

• Also, investors pay no taxes
on certain types of investment gains held within the account until
they can withdraw the amount at 59.5 years old or are forced to at
70.5 years old.

Answer 2

Traditional IRA

Question 3

A special type of retirement plan offered by employers to their employees. It usually allows investors to put their money to work in mutual funds or stable value funds.

• Employers often match contributions, such as a 50% match on the first 6% earned.
• There are no taxes owed until you can begin withdrawing the money at 59.5 years old, w/ required distributions beginning at 70.5 years old.

Answer 3

401k

Question 4

When an employee leaves their employer, they can opt to ________ their 401k balance and have it deposited into this type of account, which otherwise behaves like a Traditional IRA

Answer 4

Rollover IRA