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Meaning / Definition of

403(b)

Categories: Finance,

A 403(b) plan, sometimes known as a tax-sheltered annuity (TSA) or a tax-deferred annuity (TDA), is an employer sponsored retirement savings plan for employees of not-for-profit organizations, such as colleges, hospitals, foundations, and cultural institutions. Some employers offer 403(b) plans as a supplement to - rather than a replacement for - defined benefit (pension)s. Others offer them as the organization's only retirement plan.Your contributions to a traditional 403(b) are tax deductible, and any earnings are tax deferred. Contributions to a Roth 403(b) are made with after-tax dollars, but the withdrawals are tax free if the account has been open at least five years and you're 59 1/2 or older. There's an annual contribution limit, but you can add an additional catch-up contribution if you're 50 or older.With a 403(b), you are responsible for making your own investment decisions by choosing from among investment alternatives offered by the plan. You can roll over your assets to another employer's plan or an IRA when you leave your job, or to an IRA when you retire.You may withdraw without penalty once you reach 59 1/2, or sometimes earlier if you retire. You must begin required withdrawals by April 1 of the year following the year you turn 70 1/2 unless you are still working. In that case, you can postpone withdrawals until April 1 following the year you retire.

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Definition / Meaning of

NASD

Categories: Brokerages, Compliance and Governance,

NASD is the largest self-regulatory organization (SRO) in the United States. Formerly known as the national association of securities dealers, NASD regulates broker-dealer firms and licenses registered representatives - better known as stockbrokers - who make a business of trading securities. In addition, NASD regulates trading in stocks, mutual funds, variable annuities, corporate bonds, and futures and options contracts on securities, and acts as regulator for a number of securities exchanges, NASD also reviews materials that investment companies provide to their clients and prospective clients to ensure those materials comply with the relevant guidelines. Through its BrokerCheck database, NASD provides a resource for investors to check the credentials of people and firms with whom they're considering working. The NASD website also provides investor education and alerts on current issues of importance to investors. Finally, NASD also resolves disputes between broker-dealers and their clients, through either mediation or arbitration. NASD disciplines firms and individuals who violate the rules.

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