Retirement and Investment

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What is Compound Interest?

Back

Reinvesting earned interest back into the principal to allow money to grow exponentially over time.

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What is a Pension?

Back

A defined benefit plan offered in some job sectors or companies, that an employer maintains to give an employee a fixed payout at retirement.

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What is the #1 weapon for successful investing, especially for retirement?

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Time.

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What is a SEP IRA?

Back

A retirement plan for self-employed people and small companies.

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What is Diversification in investing?

Back

Investing in various businesses with different levels of risk.

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What is Simple Interest?

Back

Interest calculated only on the principal amount, or on that portion of the principal amount which remains unpaid.

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What is a 401(k)?

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A retirement savings plan sponsored by an employer that allows employees to save a portion of their paycheck before taxes are taken out.

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What is a Traditional IRA?

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An individual retirement account that allows individuals to direct pre-tax income towards investments that can grow tax-deferred until retirement.

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What is a Roth IRA?

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An individual retirement account that allows individuals to invest after-tax income, with tax-free growth and tax-free withdrawals in retirement.

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What does 'Time Value of Money' mean?

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The concept that money available today is worth more than the same amount in the future due to its potential earning capacity.