Question 1

There is a trend for companies to switch from defined benefit to defined contribution plans.

Accepted Answer

A) True 
 B)False

Question 2

Household expenses usually increase after retirement.

Accepted Answer

A) True 
 B)False

Question 3

More than 50 percent of all wage earners and salaried workers today are covered by some type of employer-sponsored retirement or profit-sharing plan.

Accepted Answer

A) True 
 B)False

Question 4

Julie's employer has a defined benefits retirement plan which pays 3.2 percent of her last year's salary for each year of employment.Julie estimates her final salary will be $85,000 and she will have worked for 20 years.What is her expected retirement benefit? (Show all work. )

Accepted Answer

Retirement

Question 5

The cost of an annuity is greater for females than it is for males.

Accepted Answer

A) True 
 B)False

Question 6

Will works for Micro Lance Computer Company and participates in its thrift and savings plan.For every $1.00 Will contributes to the plan,up to 5 percent of his salary,the company contributes $0.25.If Will's salary is $40,000 and he decides to maximize the matching contributions,how much will be contributed to Will's plan in a year by both the employer and Will?

Accepted Answer

A)  $4,000 
B)  $3,500 
C)  $2,500 
D)  $2,000 
E)  $1,000 
A)  $4,000 
B)  $3,500 
C)  $2,500 
D)  $2,000 
E)  $1,000

Question 7

If you are gradually vested in a retirement plan over a 4-year period,the plan is a

Accepted Answer

A)  cliff plan. 
B)  contributory plan. 
C)  self-directed plan. 
D)  graded plan. 
E)  maximum vesting plan. 
A)  cliff plan. 
B)  contributory plan. 
C)  self-directed plan. 
D)  graded plan. 
E)  maximum vesting plan.

Question 8

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Most people today must have worked in a job covered by social security for the equivalent of at least [4 years | 10 years] to be fully insured and therefore eligible for retirement benefit payments.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 9

An example of a type of plan where the amount the employee receives at retirement is dependent on investment return is a

Accepted Answer

A)  defined contribution plan. 
B)  defined benefit plan. 
C)  cash balance plan. 
D)  a and b 
E)  a,b,and c 
A)  defined contribution plan. 
B)  defined benefit plan. 
C)  cash balance plan. 
D)  a and b 
E)  a,b,and c

Question 10

____ are exclusively for the self-employed person and his/her employees.

Accepted Answer

A)  Keogh plans. 
B)  SEPs. 
C)  401(k)plans. 
D)  a and b 
E)  a,b,and c 
A)  Keogh plans. 
B)  SEPs. 
C)  401(k)plans. 
D)  a and b 
E)  a,b,and c

Question 11

To be eligible for social security retirement benefits,30 quarters of covered employment are generally needed.

Accepted Answer

A) True 
 B)False

Question 12

When one estimates retirement needs,you start with a projection of expenses stated in current dollars.

Accepted Answer

A) True 
 B)False

Question 13

The advantage of profit sharing plans that investment in their own company stock is that the minimum value of the stock is guaranteed.

Accepted Answer

A) True 
 B)False

Question 14

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-The passage of ERISA has resulted in [more | fewer] employer sponsored retirement plans being offered by small employers.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 15

Marshall has calculated that he will need $1,250,000 in his retirement fund in 40 years when he plans to retire.If Marshall can earn 8% annually over this period,how much does Marshall need to save annually to meet that goal?

Accepted Answer

The answer of Marshall has calculated that he will need...

Question 16

The purpose of the social security retirement program is to

Accepted Answer

A)  increase retirement income to 75 percent of pre-retirement income. 
B)  pay for health care costs. 
C)  replace defunct pension fund plans. 
D)  provide a basic adequate income to eligible retirees. 
E)  none of these. 
A)  increase retirement income to 75 percent of pre-retirement income. 
B)  pay for health care costs. 
C)  replace defunct pension fund plans. 
D)  provide a basic adequate income to eligible retirees. 
E)  none of these.

Question 17

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Lois,age 67,is receiving social security benefits.She received $25,000 in interest and dividends this year.Her social security benefits [will | will not] be reduced because of these earnings.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 18

Self directed retirement accounts aimed at self-employed persons include

Accepted Answer

A)  Keogh plans. 
B)  SEPs. 
C)  401(k)plans. 
D)  a and b 
E)  a,b,and c 
A)  Keogh plans. 
B)  SEPs. 
C)  401(k)plans. 
D)  a and b 
E)  a,b,and c

Question 19

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-A straight life annuity payment option will result in the [highest | lowest] possible monthly payments to the annuitant.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 20

Tax-free earnings can be gotten from investments in

Accepted Answer

A)  Roth IRAs. 
B)  Traditional IRAs. 
C)  SEP plans. 
D)  401(k)plans. 
E)  All of the above 
A)  Roth IRAs. 
B)  Traditional IRAs. 
C)  SEP plans. 
D)  401(k)plans. 
E)  All of the above

There is a trend for companies to switch from defined benefit to defined contribution plans.

Household expenses usually increase after retirement.

More than 50 percent of all wage earners and salaried workers today are covered by some type of employer-sponsored retirement or profit-sharing plan.

Julie's employer has a defined benefits retirement plan which pays 3.2 percent of her last year's salary for each year of employment.Julie estimates her final salary will be $85,000 and she will have worked for 20 years.What is her expected retirement benefit? (Show all work. )

The cost of an annuity is greater for females than it is for males.

If you are gradually vested in a retirement plan over a 4-year period,the plan is a

An example of a type of plan where the amount the employee receives at retirement is dependent on investment return is a

____ are exclusively for the self-employed person and his/her employees.

To be eligible for social security retirement benefits,30 quarters of covered employment are generally needed.

When one estimates retirement needs,you start with a projection of expenses stated in current dollars.

The advantage of profit sharing plans that investment in their own company stock is that the minimum value of the stock is guaranteed.

Marshall has calculated that he will need $1,250,000 in his retirement fund in 40 years when he plans to retire.If Marshall can earn 8% annually over this period,how much does Marshall need to save annually to meet that goal?

The purpose of the social security retirement program is to

Self directed retirement accounts aimed at self-employed persons include

Tax-free earnings can be gotten from investments in

Understanding the Financial Planning Process

Your Financial Statements and Plans

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Preserving Your Estate

Filters

Exam 14: Planning for Retirement

There is a trend for companies to switch from defined benefit to defined contribution plans.

Household expenses usually increase after retirement.

More than 50 percent of all wage earners and salaried workers today are covered by some type of employer-sponsored retirement or profit-sharing plan.

Julie's employer has a defined benefits retirement plan which pays 3.2 percent of her last year's salary for each year of employment.Julie estimates her final salary will be $85,000 and she will have worked for 20 years.What is her expected retirement benefit? (Show all work. )

The cost of an annuity is greater for females than it is for males.

If you are gradually vested in a retirement plan over a 4-year period,the plan is a

An example of a type of plan where the amount the employee receives at retirement is dependent on investment return is a

____ are exclusively for the self-employed person and his/her employees.

To be eligible for social security retirement benefits,30 quarters of covered employment are generally needed.

When one estimates retirement needs,you start with a projection of expenses stated in current dollars.

The advantage of profit sharing plans that investment in their own company stock is that the minimum value of the stock is guaranteed.

Marshall has calculated that he will need $1,250,000 in his retirement fund in 40 years when he plans to retire.If Marshall can earn 8% annually over this period,how much does Marshall need to save annually to meet that goal?

The purpose of the social security retirement program is to

Self directed retirement accounts aimed at self-employed persons include

Tax-free earnings can be gotten from investments in

Understanding the Financial Planning Process

Your Financial Statements and Plans

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Preserving Your Estate

Filters