Here is some Basic information that I have been able to understand: To get/save money, there are 4 classes .... based on taxation Free: Inheritance Tax-Free: HSA, Roth IRA, Life Insurance, 529, Money Bonds. Tax-Deferred: IRA, 401k, 403b, 457b, Annuity Taxable: Income Of course free is the best (inheritance). Tax-Free is better but Tax-deferred, which is the last best option! Income is always taxable . Income is a combination of wages, salaries, capital gains and business profit/loss on which Fed/State tax is calculated. To reduce income, you can contribute more to your retirement accounts on pre-tax basis. AGI (adjusted gross income) is income with some adjustments like HSA, educator expenses, student loan interest deductions, etc. MAGI is AGI with some deductions added back. Most universities offer a combination of plans which may be Pension plans (like STRS), Contribution plans (401k, 403b) or others. Companies offer contribution plans like 401ks. You should also explore