|Money purchase plan|
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Definition of Money purchase plan
Money purchase plan
A defined benefit contribution plan in which the participant contributes some part and
Commonly referred to as an RPP this is a tax sheltered employee group plan approved by Federal and Provincial governments allowing employees to have deductions made directly from their wages by their employer with a resulting reduction of income taxes at source. These plans are easy to implement but difficult to dissolve should the group have a change of heart. Employer contributions are usually a percentage of the employee's salary, typically from 3% to 5%, with a maximum of the lessor of 20% or $3,500 per annum. The employee has the same right of contribution. Vesting is generally set at 2 years, which means that the employee has right of ownership of both his/her and his/her employers contributions to the plan after 2 years. It also means that all contributions are locked in after 2 years and cannot be cashed in for use by the employee in a low income year. Should the employee change jobs, these funds can only be transferred to the RPP of a new employer or the funds can be transferred to an individual RRSP (or any number of RRSPs) but in either scenario, the funds are locked in and cannot be accessed until at least age 60. The only choices available to access locked in RPP funds after age 60 are the conversion to a Life Income Fund or a Unisex Annuity.
A retirement plan set up by an employer, into which employees can
A retirement plan similar to a 401k plan, except that it is designed
A budgeting process using summary-level information to
An option is at-the-money if the strike price of the option is equal to the market price of the
A plan by U.S. Treasury Secretary James Baker under which 15 principal middle-income debtor
Gives the lessee the option to purchase the asset at a price below fair market
A flexible benefits plan authorized under the Internal Revenue
cash or nontaxable benefits
Also called the broker loan rate , the interest rate that banks charge brokers to finance
A plan that provides retirement and long term disability income benefits to residents of Canadian provinces (excluding Quebec).
A transaction in which the purchaser's intention is to reduce or eliminate a short position in
Financial planning conducted by a firm that encompasses preparation of both
A pension plan in which the sponsor agrees to make specified dollar payments to
A pension plan that pays out a predetermined dollar
Defined contribution plan
A pension plan in which the sponsor is responsible only for making specified
Defined Contribution Plan
A qualified retirement plan under which the employer
Direct stock-purchase programs
The purchase by investors of securities directly from the issuer.
Dividend reinvestment plan (DRP)
Automatic reinvestment of shareholder dividends in more shares of a
Educational Assistance Plan
A plan that an employer creates on behalf of its
Employee stock ownership plan (ESOP)
A company contributes to a trust fund that buys stock on behalf of
Employee Stock Ownership Plan (ESOP)
a profit-sharing compensation program in which investments are made in
Employee Stock Ownership Plan (ESOP)
A fund containing company stock and owned by employees, paid for by ongoing contributions by the employer.
enterprise resource planning (ERP) system
a packaged software program that allows a company to
Enterprise resource planning system
A computer system used to manage all company
An insurance program designed to provide funds for insured's dependents upon death of the insured, and to also conserve, as much as possible, the personal assets that the insured wants to bequeath to heirs.
Fiat money is paper currency made legal tender by law or fiat. It is not backed by gold or silver and is not necessarily redeemable in coin. This practice has had widespread use for about the last 70 years. If governments produce too much of it, there is a loss of confidence. Even so, governments print it routinely when they need it. The value of fiat money is dependent upon the performance of the economy of the country which issued it. Canada's currency falls into this category.
A financial blueprint for the financial future of a firm.
The process of evaluating the investing and financing options available to a firm. It
Arrangement used to finance inventory. A finance company buys the inventory, which is then
See money base.
money that moves across country borders in response to interest rate differences and that moves
Hourly Rate Plan
A method for calculating wages for hourly employees that involves
A put option that has a strike price higher than the underlying futures price, or a call option
Defined benefit pension plans that are guaranteed by life insurance products. Related: noninsured plans
Insured Retirement Plan
This is a recently coined phrase describing the concept of using Universal Life Insurance to tax shelter earnings which can be used to generate tax-free income in retirement. The concept has been described by some as "the most effective tax-neutralization strategy that exists in Canada today."
The movement of inventory from one company location to
Long-term financial plan
Financial plan covering two or more years of future operations.
Manufacturing resource planning
An integrated, computerized system for planning
manufacturing resource planning (MRP II)
a fully integrated materials requirement planning system that involves
Manufacturing resource planning (MRP II)
An expansion of the material requirements planning concept, with additional computer-based capabilities in the areas of
Material requirements planning
A computerized system used to calculate material
Material requirements planning (MRP)
A computer-driven production methodology
Materials requirement planning
Computer-based systems that plan backward from the production schedule
materials requirements planning (MRP)
a computerbased information system that simulates the ordering and
For mutual funds, the amount required to open a new account (Minimum Initial
Any item that serves as a medium of exchange, a store of value, and a unit of account. See medium of exchange.
Composed of currency and coins outside the banking system plus liabilities to the deposit money banks.
Cash plus deposits of the commercial banks with the central bank.
Money center banks
Banks that raise most of their funds from the domestic and international money markets, relying less on depositors for funds.
This is the process by which "dirty money" generated by criminal activities is converted through legitimate businesses into assets that cannot be easily traced back to their illegal origins.
Related: Investment management.
Related: Investment manager.
money markets are for borrowing and lending money for three years or less. The securities in
A market that specializes in trading short-term, low-risk, very liquid
Market for short-term financial assets.
A financial market in which short-term (maturity of less than a year) debt instruments such as bonds are traded.
Financial market in which funds are borrowed or lent for short periods. (The money market is distinguished from the capital market, which is the market for long term funds.)
Money market demand account
An account that pays interest based on short-term interest rates.
Money market fund
A mutual fund that invests only in short term securities, such as bankers' acceptances,
money market fund
A type of mutual fund that invests primarily in short-term debt securities maturing in one year or less. These include treasury bills, bankers’ acceptances, commercial paper, discount notes and guaranteed investment certficates.
Money market hedge
The use of borrowing and lending transactions in foreign currencies to lock in the
Money market notes
Publicly traded issues that may be collateralized by mortgages and MBSs.
Change in the money supply per change in the money base.
A guaranteed form of payment in amounts up to and including $5,000. You might request a money order in order to pay for tuition fees at a university or a college, or for a magazine subscription.
Money Rate of Interest
See interest rate, nominal.
Money rate of return
Annual money return as a percentage of asset value.
M1-A: Currency plus demand deposits
Neutrality of Money
The doctrine that the money supply affects only the price level, with no long-run impact on real variables.
In a Treasury auction, the amount by which the par value of the securities offered exceeds that of
Defined benefit pension plans that are not guaranteed by life insurance products. Related:
Nonqualified Retirement Plan
A pension plan that does not follow ERISA and
Open-market purchase operation
A systematic program of repurchasing shares of stock in market
open purchase ordering
a process by which a single purchase
A transaction in which the purchaser's intention is to create or increase a long position in
a formulation of the details of implementing
A call option is out-of-the-money if the strike price is greater than the market price
Overfunded pension plan
A pension plan that has a positive surplus (i.e., assets exceed liabilities).
A fund that is established for the payment of retirement benefits.
A formal agreement between an entity and its employees, whereby the
Piece Rate Plan
A wage calculation method based on the number of units of production
Plan for reorganization
A plan for reorganizing a firm during the Chapter 11 bankruptcy process.
The entities that establish pension plans, including private business entities acting for their
Planned amortization class CMO
1) One class of CMO that carries the most stable cash flows and the
Planned capital expenditure program
Capital expenditure program as outlined in the corporate financial plan.
Planned financing program
Program of short-term and long-term financing as outlined in the corporate
the process of creating the goals and objectives for
The length of time a model projects into the future.
Time horizon for a financial plan.
Planning, programming and budgeting system (PPBS)
A method of budgeting in which budgets are allocated to projects or programmes rather than to responsibility centres.
Plant and Equipment
Buildings and machines that firms use to produce output.
Precautionary demand (for money)
The need to meet unexpected or extraordinary contingencies with a
Sale of bonds by the government to the central bank.
Profit Sharing Plan
A retirement plan generally funded by a percentage of company
property, plant, and equipment
This label is generally used in financial
Property, plant, and equipment
This item is comprised of all types of fixed assets
To buy, to be long, to have an ownership position.
Method of accounting for a merger in which the acquirer is treated as having purchased
As used in connection with project financing, an agreement to purchase a specific
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