Question 1

What percent of the average worker's preretirement earnings is replaced by Social Security?

Accepted Answer

A) 25% 
B) 40% 
C) 50% 
D) 70% 
E) 90% 
A) 25% 
B) 40% 
C) 50% 
D) 70% 
E) 90%

Question 2

Rebecca Murphy is planning for her retirement.She has done some checking and thinks she will get about $1,408 a month from Social Security.She also thinks her pension plan will pay her about $1,125 per month.In addition,she has some personal retirement accounts that she thinks will pay her $400 per month.What step in the retirement planning process is Rebecca completing?

Accepted Answer

A) Analyzing her current assets and liabilities 
B) Estimating her spending needs 
C) Evaluating her planned retirement income 
D) Evaluating her retirement housing 
E) Developing a balanced budget based on her retirement income 
A) Analyzing her current assets and liabilities 
B) Estimating her spending needs 
C) Evaluating her planned retirement income 
D) Evaluating her retirement housing 
E) Developing a balanced budget based on her retirement income

Question 3

Earned interest on annuities accumulates tax free until the annuity payments begin.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following is a true statement about retirement planning?

Accepted Answer

A) You can expect to spend about 16 to 30 years in retirement. 
B) It's never too early to begin planning for retirement. 
C) You should not let your 45th birthday roll by without a comprehensive retirement plan. 
D) Retirement planning has both emotional and financial components. 
E) All of these statements are true 
A) You can expect to spend about 16 to 30 years in retirement. 
B) It's never too early to begin planning for retirement. 
C) You should not let your 45th birthday roll by without a comprehensive retirement plan. 
D) Retirement planning has both emotional and financial components. 
E) All of these statements are true

Question 5

The amount of the minimum required distribution from an IRA at age 70-1/2 is based on your life expectancy at the time of the distribution.

Accepted Answer

A) True 
 B)False

Question 6

Bruce Wills has been making contributions into an individual retirement account on behalf of his nonworking wife.What type of individual retirement account is this?

Accepted Answer

A) Traditional IRA 
B) Roth IRA 
C) Spousal IRA 
D) Coverdell Education Savings Account 
E) SEP-IRA 
A) Traditional IRA 
B) Roth IRA 
C) Spousal IRA 
D) Coverdell Education Savings Account 
E) SEP-IRA

Question 7

The people who are in the best position to save are:

Accepted Answer

A) teenagers. 
B) young adults in their 20s. 
C) people in their 30s. 
D) middle-aged. 
E) elderly. 
A) teenagers. 
B) young adults in their 20s. 
C) people in their 30s. 
D) middle-aged. 
E) elderly.

Question 8

The EGTRRA was passed by Congress in 2001 and increased the employee annual contribution limit for 401(k)and other employer-sponsored retirement plans.

Accepted Answer

A) True 
 B)False

Question 9

Social Security should be the only source of your retirement income.

Accepted Answer

A) True 
 B)False

Question 10

Your contributions to a SEP-IRA,which can vary from year to year,are tax deductible and earnings accumulate on a tax-deferred basis.

Accepted Answer

A) True 
 B)False

Question 11

If you think you want to live in another city during retirement,it's a good idea to plan vacations now in areas you might enjoy later.

Accepted Answer

A) True 
 B)False

Question 12

As people reach retirement age,what is the most likely housing choice they would make? Assume they are moving to a new geographic area.

Accepted Answer

A) Split-level house with two sets of stairs 
B) 100-year old house that needs lots of renovations 
C) Smaller condominium close to the city bus line 
D) House with 10 acres far out in the country 
E) Larger rental house 
A) Split-level house with two sets of stairs 
B) 100-year old house that needs lots of renovations 
C) Smaller condominium close to the city bus line 
D) House with 10 acres far out in the country 
E) Larger rental house

Question 13

Pension plan portability enables you to carry earned benefits from one employer's pension plan to another's when you change jobs.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following have formidable retirement-planning challenges?

Accepted Answer

A) Single parents 
B) Gays and lesbians 
C) Divorced couples 
D) Unmarried individuals living together 
E) All of these 
A) Single parents 
B) Gays and lesbians 
C) Divorced couples 
D) Unmarried individuals living together 
E) All of these

Question 15

Which of the following is a tip from retirement specialists on how to uncover hidden taxes and other costs of a retirement area before moving?

Accepted Answer

A) Call or write the local Chamber of Commerce to get an economic profile. 
B) Contact the state's tax department to find out state income,sales,and inheritance taxes. 
C) Call a local CPA to find out which taxes are rising. 
D) Rent for a while instead of buying immediately. 
E) Retirement specialists recommend all of these. 
A) Call or write the local Chamber of Commerce to get an economic profile. 
B) Contact the state's tax department to find out state income,sales,and inheritance taxes. 
C) Call a local CPA to find out which taxes are rising. 
D) Rent for a while instead of buying immediately. 
E) Retirement specialists recommend all of these.

Question 16

During retirement planning,you would need to estimate your monthly retirement expenses.Provide examples of monthly expenses that are fixed and monthly expenses that are variable.

Accepted Answer

Fixed Expenses: rent or mortgage payment

Question 17

Which one of the following is not a typical characteristic of a defined benefit plan?

Accepted Answer

A) Employer contributions 
B) Formula-based benefit 
C) Investments managed by plan officials 
D) Federal government guarantees some benefit amount 
E) Employee required contributions 
A) Employer contributions 
B) Formula-based benefit 
C) Investments managed by plan officials 
D) Federal government guarantees some benefit amount 
E) Employee required contributions

Question 18

The full Social Security benefit for a spouse is what percent of the retired worker's full benefit?

Accepted Answer

A) 25 
B) 40 
C) 50 
D) 65 
E) 80 
A) 25 
B) 40 
C) 50 
D) 65 
E) 80

Question 19

When you change jobs,your 401(k)plan savings can be left with the previous employer's plan,can be rolled over to the new employer's plan or to an IRA,or can be cashed out.

Accepted Answer

A) True 
 B)False

Question 20

Employees who are covered under the Railroad Retirement System are also covered by Social Security.

Accepted Answer

A) True 
 B)False

What percent of the average worker's preretirement earnings is replaced by Social Security?

Earned interest on annuities accumulates tax free until the annuity payments begin.

Which of the following is a true statement about retirement planning?

The amount of the minimum required distribution from an IRA at age 70-1/2 is based on your life expectancy at the time of the distribution.

Bruce Wills has been making contributions into an individual retirement account on behalf of his nonworking wife.What type of individual retirement account is this?

The people who are in the best position to save are:

The EGTRRA was passed by Congress in 2001 and increased the employee annual contribution limit for 401(k)and other employer-sponsored retirement plans.

Social Security should be the only source of your retirement income.

Your contributions to a SEP-IRA,which can vary from year to year,are tax deductible and earnings accumulate on a tax-deferred basis.

If you think you want to live in another city during retirement,it's a good idea to plan vacations now in areas you might enjoy later.

As people reach retirement age,what is the most likely housing choice they would make? Assume they are moving to a new geographic area.

Pension plan portability enables you to carry earned benefits from one employer's pension plan to another's when you change jobs.

Which of the following have formidable retirement-planning challenges?

Which of the following is a tip from retirement specialists on how to uncover hidden taxes and other costs of a retirement area before moving?

During retirement planning,you would need to estimate your monthly retirement expenses.Provide examples of monthly expenses that are fixed and monthly expenses that are variable.

Which one of the following is not a typical characteristic of a defined benefit plan?

The full Social Security benefit for a spouse is what percent of the retired worker's full benefit?

When you change jobs,your 401(k)plan savings can be left with the previous employer's plan,can be rolled over to the new employer's plan or to an IRA,or can be cashed out.

Employees who are covered under the Railroad Retirement System are also covered by Social Security.

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: the Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health,disability,and Long-Term Care Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Estate Planning

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Exam 18: Starting Early: Retirement Planning

What percent of the average worker's preretirement earnings is replaced by Social Security?

Earned interest on annuities accumulates tax free until the annuity payments begin.

Which of the following is a true statement about retirement planning?

The amount of the minimum required distribution from an IRA at age 70-1/2 is based on your life expectancy at the time of the distribution.

Bruce Wills has been making contributions into an individual retirement account on behalf of his nonworking wife.What type of individual retirement account is this?

The people who are in the best position to save are:

The EGTRRA was passed by Congress in 2001 and increased the employee annual contribution limit for 401(k)and other employer-sponsored retirement plans.

Social Security should be the only source of your retirement income.

Your contributions to a SEP-IRA,which can vary from year to year,are tax deductible and earnings accumulate on a tax-deferred basis.

If you think you want to live in another city during retirement,it's a good idea to plan vacations now in areas you might enjoy later.

As people reach retirement age,what is the most likely housing choice they would make? Assume they are moving to a new geographic area.

Pension plan portability enables you to carry earned benefits from one employer's pension plan to another's when you change jobs.

Which of the following have formidable retirement-planning challenges?

Which of the following is a tip from retirement specialists on how to uncover hidden taxes and other costs of a retirement area before moving?

During retirement planning,you would need to estimate your monthly retirement expenses.Provide examples of monthly expenses that are fixed and monthly expenses that are variable.

Which one of the following is not a typical characteristic of a defined benefit plan?

The full Social Security benefit for a spouse is what percent of the retired worker's full benefit?

When you change jobs,your 401(k)plan savings can be left with the previous employer's plan,can be rolled over to the new employer's plan or to an IRA,or can be cashed out.

Employees who are covered under the Railroad Retirement System are also covered by Social Security.

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: the Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health,disability,and Long-Term Care Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Estate Planning

Filters