Exam 18: Starting Early: Retirement Planning

What is most likely to be an individual's single biggest asset?

How can retirees avoid housing traps?

The rate of return on annuities is rarely pegged to market rates.

The Employee Retirement Income Security Act of 1974 (ERISA)sets minimum standards for pension plans in private industry.

During a divorce,pension benefits are generally divided between the spouses primarily based on the:

What type of annuity is generally purchased by people of retirement age?

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

If you are a government employee,you may have a Section 457 plan.

Your first step in retirement planning is to:

Once you retire,the first step in stretching your retirement income is to make sure that you are:

Whether or not you are covered by a pension plan,you can still make nondeductible IRA contributions.

When a lender uses your house as collateral to buy an annuity for you from a life insurance company,it is called:

The law exempts Social Security benefits from federal income taxes.

You can depend on your employer's health insurance plan and Medicare to pay all your medical expenses when you retire.

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

Some experts suggest starting retirement planning while you are in school.

Your mortgage,car payments,credit card balances,and taxes due are all examples of your liabilities.

Which of the following is typically a characteristic of a defined contribution plan?

Only saving now and curtailing current spending can ensure comfortable retirement later.

Janice Jacobs is planning for her retirement.She knows what assets and liabilities she has now and expects to have in the future.She knows what her spending patterns are likely to be and adjusted them for inflation.She also has identified all of her sources of income after she retires.Now she is sitting down and planning her income and expenses each month.After she has finished this plan,she knows that she has enough income to cover her expected expenses and still have $200 extra each month for emergencies and other unplanned activities.Even with inflation,she thinks she can sustain this plan for approximately 30 years.What step in the retirement planning process is Janice completing?