SIE: Retirement Plans

Variable Annuities are
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Terms in this set (19)
Keogh (HR-10) Plans25% 61,000 max effective rate is 20%ERISA Requirementsnon discrimination, employees must earn benefits over 5 years (vesting) at 20%/year of service, fiduciary responsibility of plan trustee, prudent man rule (no speculative strategies), whole life insurance not alloweddefined contribution planretirement plan in which the employer sets up an individual account for each employee and specifies the size of the investment into that accountdefined benefit planpension plan that guarantees a specified level of retirement income. Older employees closer to retirements have a much greater benefit than younger employeesprofit-sharing plana benefit whereby employees may share in the profits of the businessDeferred Compensation PlanA nonqualified retirement plan whereby the employee defers receiving current compensation in favor of a larger payout at retirement (or in the case of disability or death).SEP IRAA retirement plan created to benefit self-employed persons and small business owners. Contributions to a SEP IRA are typically 100% tax deductible and earnings grow tax deferred. $61,000 maxSIMPLE IRASavings Incentive Match Plan for Employees A retirement plan sponsored by companies with fewer than 100 employees; though it may be structured as a 401(K), it avoids some of the administrative fees and paperwork of those plans. 14,000 maxCoverdell ESAFormerly known as the Education IRA, this offers tax-deferred growth and tax-free withdrawal of funds used to pay for education. Subject to certain earnings limits, after-tax contributions up to a certain amount per year may be made for a beneficiary up until the beneficiary's 18th birthday. The account may be used for qualifying educational expenses at any grade level, from elementary school through graduate school.