Federal Taxes and Social Security Flashcard

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What is a retirement plan contribution?

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A retirement plan contribution is money that an employer or employee puts into a retirement savings account to help fund the employee's retirement.

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Why do employers match retirement contributions?

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Employers match retirement contributions to encourage employees to save for retirement, effectively increasing the total amount saved.

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What types of insurance might employers offer?

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Employers may offer various types of insurance, including health, dental, vision, life, and sometimes disability insurance.

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At what age can individuals qualify for Medicare?

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Individuals can qualify for Medicare health coverage at age 65.

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What is the purpose of saving money from your paycheck for retirement?

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The purpose is to accumulate funds that will provide financial support during retirement when individuals are no longer working.

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What is Social Security?

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Social Security is a government program that provides financial assistance to individuals during retirement, disability, or upon death of a family wage earner.

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What is the significance of employer-sponsored retirement plans?

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Employer-sponsored retirement plans provide employees with a structured way to save for retirement, often with tax advantages and potential employer matching.

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What are the benefits of having dental and vision insurance?

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Dental and vision insurance helps cover the costs of routine check-ups, treatments, and corrective lenses, promoting overall health.

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How does saving for retirement impact financial security?

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Saving for retirement enhances financial security by ensuring that individuals have funds available to cover living expenses when they retire.

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What is the difference between a 401(k) and an IRA?

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A 401(k) is an employer-sponsored retirement plan, while an IRA (Individual Retirement Account) is a personal savings plan that offers tax advantages.