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Glossary

What is a Rollover?

A rollover is a tax-free reinvestment of a distribution from a qualified retirement plan into an IRA or other qualified plan within a specific time frame, usually 60 days. An individual will commonly initiate a rollover after leaving a job at an...

What is a Roth IRA?

A Roth IRA is a newer type of IRA, established in the Taxpayer Relief Act of 1997, which allows taxpayers, subject to certain income limits, to save for retirement while allowing the earnings to grow tax-free. Contributions are made with after-tax...

What is the S&P 500?

The Standard & Poor's 500 Index is a basket of 500 stocks that are considered to be widely held and selected based upon their market size, liquidity, and sector. The S&P 500 Index is weighted by market value, and its performance is thought to be...

What is a Savings Account?

A savings account is a deposit account held at a bank or other financial institution that is FDIC-insured and protects your principal while paying a modest interest rate. Savings accounts are not intended to be transactional accounts, so features...

What is a Secured Credit Card?

A secured credit card is a credit card linked to a savings account. The funds contained in the account are used by the issuing card company as collateral for credit and may be claimed in the event that the cardholder fails to make the necessary...

What is a SEP IRA?

A SEP IRA is a retirement plan available to self-employed persons and small business owners. Contributions up to 25% of eligibile compensation or max of $51,000 (2013) to a SEP IRA are typically 100% tax deductible and earnings grow tax deferred....

What is Social Security?

Social Security is the comprehensive federal program of benefits providing workers and their dependents with retirement income, disability income, Medicare, Medicaid and other payments. The Social Security tax is used to pay for the program, which...

What is a Standard Deduction?

A standard deduction is a base amount of income that is not subject to tax and can be used to reduce a taxpayer's adjusted gross income (AGI). A standard deduction can only be used if a taxpayer does not choose the itemized deduction method of...

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