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
- AnnuityA contract with an insurance company that converts a sum of money into a stream of steady payments over time.
- Immediate AnnuityAn annuity that begins paying you income right after you hand over a lump sum, often used at the start of retirement.
- Tax-Deferred GrowthInvestment gains that build up untaxed inside a retirement account until you withdraw the money later.
- PensionA retirement plan where your employer promises a set monthly payment for life, usually based on your salary and years worked.
- Longevity RiskThe chance that you outlive your retirement savings because you live longer than your money was planned to last.
- Safe Withdrawal RateThe percentage of your savings you can spend each year with low risk of running out of money during retirement.
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Plain-English education — not personalized legal, tax, or investment advice.