Retirement plans
There are numerous plans the we can analyze that fall into the retirement plan category, most of these plans allow investors to deposit their monthly sum into the retirement plan account before taxes have been deducted. Some employers have a system whereby they match your contribution, thus doubling your savings every month(corporate matching). Most retirement plans do not allow you to withdraw any funds from the account, there are however some newer schemes that allow early withdrawals or make the cash available via some sort of loan agreement with the financial institution. Rates of return on retirement plans vary depending on the initial and monthly investments, since you can invest in stocks, bonds, mutual funds, CDs, or any combination.

Lets have a closer look at some available retirement options:

• 401(k) retirement plan: The 401k refers to a retirement savings vehicle offered by employers, named after the Internal Revenue Code section in which it is covered in legislatures. Taking the tax advantages into consideration and the possibility of corporate matching (when your employer matches your own contribution), the 401(k) is well worth considering.
• 403(b) retirement plan: This refers to the 401(k) plan for non profit organizations. Local and state governments offer the 457 plan.
• Individual Retirement Account (IRA): An IRA falls into the group of plans that allow you to put some of your income into a tax-deferred retirement fund, you won’t pay taxes until you withdraw your funds. Withdrawals are taxed at regular income tax rates, not at the lower capital gains rates. All IRAs are specialized savings accounts. IRA’s allow the investors to invest his money in anything they prefer.
• Roth IRA (Individual Retirement Account): Roth IRA’s differ from the normal IRA’s in that it provides no tax deduction up front on any contributions made. It does however offer total exemption from federal taxes when you use the funds to pay for your retirement or your first home.
• Keogh: Keogh is a special type of IRA that doubles as a pension plan for a self-employed person. The Keogh plan allows self employed people to save a lot more than the allowed $2 000 when investing in an IRA.
• Simplified Employee Pension Plan or SEP Plan: A SEP is a specialized form or the Keogh-individual retirement account. SEPs were introduced so that small businesses could also offer retirement plans. These plans are a lot easier and more efficient to administrate. SEP’s allow employers and individuals to contribute towards the pension plan.

Well, I hope this has shed some more light on 401 K, IRA’s, Keogh’s, SEP’s and other retirement plan options that are available today.