A fuller guide to this term is on the way. In the meantime, the related terms below explain the ideas around it.
Related MoneyPedia terms
- 401(k)A retirement account through your job, often with an employer match — free money for saving.
- 457 PlanA retirement plan for state and local government workers that allows penalty-free withdrawals once you leave your job.
- Employer MatchMoney your company adds to your retirement account based on how much you contribute, effectively free money toward your savings.
- Contribution LimitThe maximum amount the government lets you put into a retirement account in a single year.
- Catch-Up ContributionAn extra amount people age fifty and older can add to retirement accounts beyond the standard yearly limit.
- VestingThe process of earning full ownership of employer-contributed retirement money, often requiring you to stay for a set number of years.
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Plain-English education — not personalized legal, tax, or investment advice.