6 Key Retirement Terms Part II

6 Essential Retirement Terms Part II

Think you’ve got retirement terms down? This quick 2-minute video breaks down essential concepts like mutual funds, compound growth, and contribution limits—so you can make smarter financial decisions. With the 2025 401(k) limit raised to $23,500 (plus an extra $7,500 for those 50+), understanding these terms could help you save more and retire with confidence. Spanish Version

Visual	Audio
A book floats in and opened. A question mark hovered above while the book floats up and down. Then terms popped up; Contribution limits, Mutual Funds, Compound Growth, Risk Tolerance, Required Minimum Distribution, Catch- Up Contributions.	You don’t have to be an expert to save for retirement but knowing a few key terms can help you save more successfully.
Term Contribution Limits and its phonetic spelling swiped in. Meaning of the term slowly fade in.	Let’s start with contribution limits, which are the maximum amount of money the IRS allows you to add to your retirement account each year.
Let’s start with contribution limits, which are the maximum amount of money the IRS allows you to add to your retirement account each year.	Saving any amount is positive but pushing as close to the limit as you can means more income in retirement. These limits go up each year, so over time you can save even more.
Term Catch-Up Contributions and its phonetic spelling swiped in. Meaning of the term slowly fade in.	Catch-up contributions are related to contribution limits. People who are 50 or older have an even higher limit.
Coin floats in and a meter pops in, coin shrinks and the meter points on green. Coin keeps being flipped while floating.	The idea is, if you haven’t been able to max out your savings in the past, catch-up contributions allow you to add even more to your retirement account to make up for missed opportunities. These limits also change annually.
Term Mutual Funds and its phonetic spelling swiped in. Meaning of the term slowly fade in.	A significant chunk of your contributions is likely to go into mutual funds, which is a type of investment made up of a collection of stocks, bonds, or other assets that are managed by an investment professional.
Fade in a shaking hands then a paper with dollar ($) sign slide in. Stocks + Bonds + Other Assets slide in.	When you invest in a mutual fund through your retirement account, you’re essentially buying a small piece of a larger portfolio, which simplifies investing and spreads out risk.
Term Risk vs. Return Trade-Off and its phonetic spelling swiped in. Meaning of the term slowly fade in.	Term Risk vs. Return Trade-Off and its phonetic spelling swiped in. Meaning of the term slowly fade in. One risk worth considering is accepting the potential for more short-term ups and downs in your retirement account in exchange for the possibility of higher returns over the long term. This is called the Trade-Off between risk and return.
Bar graph slowly popping-in, animation keeps going up and down.	By taking on the risk of short-term market volatility for growth-oriented investments like stocks, you give your retirement savings a better chance to grow over time and outpace inflation. On the flip side, owning more cash or bonds likely lowers short-term volatility, but the trade-off is likely lower returns over the long term.
By taking on the risk of short-term market volatility for growth-oriented investments like stocks, you give your retirement savings a better chance to grow over time and outpace inflation. On the flip side, owning more cash or bonds likely lowers short-term volatility, but the trade-off is likely lower returns over the long term.	The reason all the concepts we’re discussing are so important is that they affect your compound growth. Compound growth is the “magic” behind your retirement plan. It’s the process where your money earns more money over time.
A coin floats in and then flipped while an arrow rotates around it. Coin and arrow shifts smaller to the side while a column chart pops in and an arrow above the graph that shows increase swiped in.	As you continue to contribute and invest, you keep adding more growth potential, which over time can multiply into a large nest egg. After years of compound growth, you’ll finally be ready to begin withdrawing your hard-earned savings.
Term Required Minimum Distribution (RMD) and its phonetic spelling swiped in. Meaning of the term slowly fade in.	In fact, at some point, you’ll be required by the IRS to withdraw from your retirement account. Called a required minimum distribution, or RMD, this is the amount you must take out from your retirement each year.
A stack of coin slide in and an old man with a cane popped in the first and second layer of the stacked coins while a flipping coin is positioned on the top of the pile of coins.	RMDs usually start in your 70s, but don’t worry, we guide you through the process when the time comes.
A female popped in first then the terms popped up; Contribution limits, Mutual Funds, Compound Growth, Risk Tolerance, Required Minimum Distribution, Catch- Up Contributions.	You don’t have to be an expert to improve your retirement savings. With these key concepts in your back pocket, you’ll be on your way toward saving for a comfortable retirement.
Logo reveal; orange slash reveals the texts “Fisher” and “SMB”. The Contact Us with blue background slides in. And the Disclosure also fade in.	Logo reveal; orange slash reveals the texts “Fisher” and “SMB”. The Contact Us with blue background slides in. And the Disclosure also fade in.