Tools
Financial Glossary
Plain-language definitions for the financial terms you'll encounter on your path to retirement.
Financial Glossary — Morgan Advisor Group
401(k)
A tax-advantaged retirement savings plan offered by employers. Contributions are made pre-tax, reducing your taxable income today.
Annuity
A financial product that provides a stream of payments over time, often used to generate guaranteed income in retirement.
Asset Allocation
The distribution of investments across different asset classes (stocks, bonds, cash) based on your goals and risk tolerance.
Beneficiary
The person or entity designated to receive assets from an account, policy, or estate upon the owner's death.
Diversification
Spreading investments across different assets to reduce risk. The idea is that not all investments will decline at the same time.
Estate Plan
A set of legal documents that determine how your assets will be distributed after your death and who will make decisions if you're incapacitated.
IRA (Individual Retirement Account)
A tax-advantaged account for retirement savings. Traditional IRAs offer tax-deferred growth; Roth IRAs offer tax-free growth.
Medicare
Federal health insurance for people 65 and older, and for some younger people with disabilities.
Required Minimum Distribution (RMD)
The minimum amount you must withdraw from certain retirement accounts each year once you reach age 73.
Roth Conversion
Moving money from a traditional IRA to a Roth IRA. You pay taxes on the converted amount now, but future growth and withdrawals are tax-free.
Social Security
A federal program that provides retirement, disability, and survivor benefits. Benefits are based on your earnings history.
Trust
A legal arrangement where one party (the trustee) holds assets for the benefit of another (the beneficiary). Trusts can help avoid probate and provide control over asset distribution.