Glossary
Wealth terms, in plain language
Quick, clear definitions of the retirement, investment, and business terms you’ll come across as you take control of your wealth.
Retirement Accounts
- Annuity
- A contract with an insurance company that converts a lump sum or series of payments into a stream of income, often used to provide predictable cash flow in retirement.
- Checkbook Control
- A structure (often an IRA- or 401(k)-owned LLC) that lets you direct investments by writing a check or sending a wire, without waiting on custodian approval for each transaction.
- Custodian
- The IRS-approved institution that holds the assets in your IRA and handles reporting. A self-directed custodian permits alternative investments that conventional brokerages do not.
- IRA Rollover rollover
- Moving funds from one retirement account (such as an old 401(k)) into an IRA without triggering taxes or penalties, when done within IRS rules.
- Roth IRA roth
- A retirement account funded with after-tax dollars. Qualified withdrawals in retirement — including investment growth — are tax-free.
- Self-Directed IRA (SDIRA) SDIRA · self directed ira
- An individual retirement account that lets you invest beyond stocks, bonds, and mutual funds — into alternative assets such as real estate, private equity, precious metals, and more, while keeping the account's tax advantages.
- Self-Directed IRA service
- Solo 401(k) solo 401k · individual 401k · one-participant 401k
- A 401(k) plan designed for self-employed individuals and small business owners with no full-time employees other than a spouse. It allows high annual contributions as both employee and employer.
- Solo 401(k) service
- Traditional IRA
- A retirement account typically funded with pre-tax dollars. Contributions may be tax-deductible and growth is tax-deferred until you withdraw in retirement.
Rules & Taxes
- Contribution Limit
- The maximum amount the IRS allows you to add to a retirement account each year. Limits vary by account type and age, with higher 'catch-up' amounts for older savers.
- Disqualified Person
- Someone your retirement account cannot do business with, including you, your spouse, your lineal ascendants and descendants, and entities they control.
- Prohibited Transaction
- An improper use of a retirement account — such as transacting with a disqualified person — that the IRS bans and that can disqualify the account if it occurs.
- Required Minimum Distribution (RMD) RMD
- The minimum amount you must begin withdrawing from certain tax-deferred retirement accounts at a set age. Roth IRAs are not subject to RMDs during the owner's lifetime.
- Tax-Deferred
- Growth you are not taxed on until you withdraw the money — the model used by Traditional IRAs and many 401(k)s, allowing earnings to compound before taxes are paid.
- Tax-Free Growth
- Investment growth that is never taxed, provided distribution rules are met — the hallmark of a Roth account funded with after-tax dollars.
- Unrelated Business Income Tax (UBIT) UBIT · UBTI
- A tax that can apply when a retirement account earns income from an active business or from debt-financed investments, even though the account is otherwise tax-advantaged.
Alternative Investments
- Alternative Assets alternative investments · alts
- Investments outside traditional stocks, bonds, and mutual funds — including real estate, private equity, private lending, precious metals, and cryptocurrency — that a self-directed account can hold.
- Self-Directed IRA service
- Cryptocurrency crypto
- Digital assets such as Bitcoin and Ethereum that can be held within a self-directed retirement account, combining alternative-asset exposure with tax-advantaged treatment.
- Precious Metals
- IRS-approved gold, silver, platinum, and palladium that meet purity standards and can be held inside a self-directed retirement account through an approved depository.
- Private Equity
- Ownership in companies that are not publicly traded, such as startups or private operating businesses, often accessed through a self-directed retirement account.
- Private Lending
- Acting as the lender — your retirement account loans money to a borrower in exchange for interest, secured by a note and often by collateral such as real estate.
- Real Estate IRA
- A self-directed IRA used to hold real property — rentals, land, or notes. Income and gains flow back into the account, and account rules prohibit personal use of the property.
Business & Legal
- Asset Protection
- Structuring your finances and business so personal and investment assets are shielded from lawsuits, creditors, and other risks, often through entities and trusts.
- Asset Protection service
- C-Corporation C-corp
- A corporation taxed as a separate entity from its owners. It offers strong liability protection and flexible ownership, but profits can be taxed at both the corporate and shareholder levels.
- Entity Formation
- The process of legally establishing a business entity — such as an LLC or corporation — to create a foundation for liability protection, tax planning, and credibility.
- Entity Formation service
- Estate Planning
- Arranging in advance how your assets will be managed and passed on — through wills, trusts, and beneficiary designations — to preserve wealth and honor your wishes.
- Estate Planning service
- Limited Liability Company (LLC) LLC
- A business structure that combines liability protection with operational flexibility, separating personal assets from business activity and offering pass-through taxation.
- Entity Formation service
- S-Corporation S-corp
- A corporation that elects pass-through taxation, so profits are taxed to the owners rather than at the corporate level, while potentially reducing self-employment tax.
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