12. Vocabulary-Self-directed retirement programs Terminology: Self-Directed Retirement Programs It seems that much of the retirement planning conversation involves the employer-employee relationship. For individuals who are self-employed, se directed retirement programs also allow them to plan for their retirement. Match the terms relating to the basic terminology and concepts associated with self-directed retirement programs on the left with the descriptions of the terms on the right. Read each description carefully and type the letter of the description in the Answer column next to the correct term. These are not necessarily complete definitions. but there is only one possible answer for each term. Term Answer Description Keogh plan A. At age 70 1/2, you must start, except if have a Keogh account and are gainfully employed or you have a Roth IRA Introduced in 1962, this plan allows self-employed individuals to set up tax-deferred SEP plan . retirement plans or accounts for themselves and their employees. Individual retirement For people in their 30s and 40s, a Roth IRA is an appropriate investment decision. C. arrangement Traditional IRA With this type of account, earnings accrue tax.free and are not subject to tax until they D. are withdrawn (after the individual reaches age 59 1/2). with this account, all withdrawals from the account are tax free provided that the Nondeductible IRA . account has been open for at least five years and the individual is past age 59 1/2. Amed at small-business owners, this plan is just like a Keogh plan. Roth IRA F. An individual, who decides which investments to buy and seil, designs this retirement Self-directed retirement plan G. plan. If you change jobs, arrange for your IRA funds to transfer from one firm to another Withdrawal H. Rollover This type of account can be opened by anyone without a retirement plan at his or her I. place of employment regard ess of Income ievel A possible investment decision It requires that a form be completed designating it as this type of account and makes J. the institution its trustee