Question

What is the biggest difference in who controls the 401(k) and IRA retirement plans? a. IRA is intended for a stable retirement income, while a 401(k) is reserved for emergencies or luxuries. b. 401(k) is a good last minute investment for retirement, while IRAs require years of investing. c. IRAs allow one to save a lot more money towards retirement than a 401(k). d. A 401(k) is controlled and monitored by an employer, and an IRA is controlled by the investing individual. Please select the best answer from the choices provided A B C D

Answer 1

Answer:

The answer is: D) A 401(k) is controlled and monitored by an employer, and an IRA is controlled by the investing individual.

Explanation:

A 401(k) is sponsored and controlled by an employer. The employer decides where the money is going to be invested. Sometimes the employer may match some of the employees' contributions. The employer can also take loans or hardship withdrawals from the 401(k) funds.

While IRA accounts are held by custodians which are banks or brokerage firms.

Answer 2

Answer:

d. A 401(k) is controlled and monitored by an employer, and an IRA is controlled by the investing individual.

Explanation:

A 401(k) retirement plan is a plan sponsored by an employer and it allows employees to save part of their salary before the taxes are deducted.

An IRA retirement plan is an account that is used to save for retirement and it is established by a person through a broker.

According to this, the biggest difference in who controls the 401(k) and IRA retirement plans is that a 401(k) is controlled and monitored by an employer, and an IRA is controlled by the investing individual.