Question 1

When an employer's contribution is used to buy stock in the company for its employees, it has a

Accepted Answer

A)  401(k) plan. 
B)  Money-purchase plan. 
C)  Profit-sharing plan. 
D)  Salary-reduction plan. 
E)  Stock bonus plan. 
A)  401(k) plan. 
B)  Money-purchase plan. 
C)  Profit-sharing plan. 
D)  Salary-reduction plan. 
E)  Stock bonus plan.

Question 2

A salary-reduction plan for a nonprofit organization is called a 401(k) plan.

Accepted Answer

A) True 
 B)False

Question 3

Vesting is the right to receive the

Accepted Answer

A)  Employer's contributions to a pension plan even if the employee leaves the company before retiring. 
B)  401(k) contributions made by the employee. 
C)  Employee's contributions each pay period. 
D)  Portable employee benefits from a defined-benefit plan. 
E)  Employee of the month award at a company that makes life jackets. 
A)  Employer's contributions to a pension plan even if the employee leaves the company before retiring. 
B)  401(k) contributions made by the employee. 
C)  Employee's contributions each pay period. 
D)  Portable employee benefits from a defined-benefit plan. 
E)  Employee of the month award at a company that makes life jackets.

Question 4

An employer may choose to match the contribution made by employees in a

Accepted Answer

A)  401(k) plan or a salary-reduction plan. 
B)  Money-purchase plan. 
C)  Stock bonus plan. 
D)  Profit-sharing plan. 
E)  Individual retirement account. 
A)  401(k) plan or a salary-reduction plan. 
B)  Money-purchase plan. 
C)  Stock bonus plan. 
D)  Profit-sharing plan. 
E)  Individual retirement account.

Question 5

A codicil is

Accepted Answer

A)  A document that explains, adds, or deletes provisions in an existing will. 
B)  A handwritten will. 
C)  Another name for the first will an individual writes. 
D)  A will written in legal code. 
E)  None of these. 
A)  A document that explains, adds, or deletes provisions in an existing will. 
B)  A handwritten will. 
C)  Another name for the first will an individual writes. 
D)  A will written in legal code. 
E)  None of these.

Question 6

Because of the potential effect of inflation, individuals should underestimate the amount of money needed for retirement.

Accepted Answer

A) True 
 B)False

Question 7

A testamentary trust takes effect while you're alive.

Accepted Answer

A) True 
 B)False

Question 8

The best definition of estate planning is

Accepted Answer

A)  Assets less liabilities. 
B)  A definite plan for managing property during one's lifetime and at one's death. 
C)  Naming a beneficiary. 
D)  Savings. 
E)  A will. 
A)  Assets less liabilities. 
B)  A definite plan for managing property during one's lifetime and at one's death. 
C)  Naming a beneficiary. 
D)  Savings. 
E)  A will.

Question 9

The maximum gift that can be given to another person without incurring gift taxes is

Accepted Answer

A)  $0. 
B)  $1,000. 
C)  $10,000. 
D)  $14,000. 
E)  $16,500. 
A)  $0. 
B)  $1,000. 
C)  $10,000. 
D)  $14,000. 
E)  $16,500.

Question 10

A statutory will is one that is prepared with the help of an attorney.

Accepted Answer

A) True 
 B)False

Question 11

When estimating your budget or spending plan at retirement, you should consider all of the following except

Accepted Answer

A)  Checking that you are receiving all income to which you are entitled. 
B)  Evaluating all assets or valuables that you might be able to convert to cash or sources of income. 
C)  Receiving special discounts because of your retiree status or age. 
D)  Taking advantage of free and low-cost recreation opportunities. 
E)  Withdrawing all retirement savings within five years of retirement. 
A)  Checking that you are receiving all income to which you are entitled. 
B)  Evaluating all assets or valuables that you might be able to convert to cash or sources of income. 
C)  Receiving special discounts because of your retiree status or age. 
D)  Taking advantage of free and low-cost recreation opportunities. 
E)  Withdrawing all retirement savings within five years of retirement.

Question 12

Which retirement plan specifies the benefits you'll receive at retirement age based on your total earning and years on the job?

Accepted Answer

A)  Defined-benefit plan. 
B)  Money-purchase plan. 
C)  Defined-contribution plan. 
D)  Profit-sharing plan. 
E)  401(k) plan. 
A)  Defined-benefit plan. 
B)  Money-purchase plan. 
C)  Defined-contribution plan. 
D)  Profit-sharing plan. 
E)  401(k) plan.

Question 13

An exemption trust will has all of your assets going to your spouse except for a certain amount of assets, which goes into a trust.

Accepted Answer

A) True 
 B)False

Question 14

Trusts and estates must pay quarterly estimated taxes based on taxable income for

Accepted Answer

A)  Estate tax. 
B)  Gift tax. 
C)  Inheritance tax. 
D)  federal income tax purposes. 
E)  Will tax. 
A)  Estate tax. 
B)  Gift tax. 
C)  Inheritance tax. 
D)  federal income tax purposes. 
E)  Will tax.

Question 15

A will prepared on a preprinted form from a stationery store is called a(n)

Accepted Answer

A)  Formal will. 
B)  "I love you" will. 
C)  Holographic will. 
D)  Ordinary will. 
E)  Statutory will. 
A)  Formal will. 
B)  "I love you" will. 
C)  Holographic will. 
D)  Ordinary will. 
E)  Statutory will.

Question 16

According to the text, which of the following will probably be your most valuable asset at retirement?

Accepted Answer

A)  Automobile. 
B)  House. 
C)  Investments. 
D)  Life insurance. 
E)  All of these. 
A)  Automobile. 
B)  House. 
C)  Investments. 
D)  Life insurance. 
E)  All of these.

Question 17

The SEP IRA is the simplest type of retirement plan if a person is self-employed.

Accepted Answer

A) True 
 B)False

Question 18

When thinking about retirement, which of the following is correct?

Accepted Answer

A)  You'll spend less money when you retire. 
B)  Saving just a little bit won't help. 
C)  You can depend on Social Security and a company pension plan to pay your basic living expenses. 
D)  The sooner you start saving, the better. 
E)  Your pension benefits will increase to keep pace with inflation. 
A)  You'll spend less money when you retire. 
B)  Saving just a little bit won't help. 
C)  You can depend on Social Security and a company pension plan to pay your basic living expenses. 
D)  The sooner you start saving, the better. 
E)  Your pension benefits will increase to keep pace with inflation.

When an employer's contribution is used to buy stock in the company for its employees, it has a

A salary-reduction plan for a nonprofit organization is called a 401(k) plan.

Vesting is the right to receive the

An employer may choose to match the contribution made by employees in a

A codicil is

Because of the potential effect of inflation, individuals should underestimate the amount of money needed for retirement.

A testamentary trust takes effect while you're alive.

The best definition of estate planning is

The maximum gift that can be given to another person without incurring gift taxes is

A statutory will is one that is prepared with the help of an attorney.

When estimating your budget or spending plan at retirement, you should consider all of the following except

Which retirement plan specifies the benefits you'll receive at retirement age based on your total earning and years on the job?

An exemption trust will has all of your assets going to your spouse except for a certain amount of assets, which goes into a trust.

Trusts and estates must pay quarterly estimated taxes based on taxable income for

A will prepared on a preprinted form from a stationery store is called a(n)

According to the text, which of the following will probably be your most valuable asset at retirement?

The SEP IRA is the simplest type of retirement plan if a person is self-employed.

When thinking about retirement, which of the following is correct?

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Financial Services: Saving Plans and Payment Accounts

Consumer Credit: Advantages, Disadvantages, Sources, and Costs

Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Selecting and Financing Housing

Home and Automobile Insurance

Health and Disability Insurance

Financial Planning With Life Insurance

Investing Fundamentals and Bonds

Investing in Stocks

Investing in Mutual Funds

Filters

Exam 14: Starting Early: Retirement and Estate Planning

When an employer's contribution is used to buy stock in the company for its employees, it has a

A salary-reduction plan for a nonprofit organization is called a 401(k) plan.

Vesting is the right to receive the

An employer may choose to match the contribution made by employees in a

A codicil is

Because of the potential effect of inflation, individuals should underestimate the amount of money needed for retirement.

A testamentary trust takes effect while you're alive.

The best definition of estate planning is

The maximum gift that can be given to another person without incurring gift taxes is

A statutory will is one that is prepared with the help of an attorney.

When estimating your budget or spending plan at retirement, you should consider all of the following except

Which retirement plan specifies the benefits you'll receive at retirement age based on your total earning and years on the job?

An exemption trust will has all of your assets going to your spouse except for a certain amount of assets, which goes into a trust.

Trusts and estates must pay quarterly estimated taxes based on taxable income for

A will prepared on a preprinted form from a stationery store is called a(n)

According to the text, which of the following will probably be your most valuable asset at retirement?

The SEP IRA is the simplest type of retirement plan if a person is self-employed.

When thinking about retirement, which of the following is correct?

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Financial Services: Saving Plans and Payment Accounts

Consumer Credit: Advantages, Disadvantages, Sources, and Costs

Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Selecting and Financing Housing

Home and Automobile Insurance

Health and Disability Insurance

Financial Planning With Life Insurance

Investing Fundamentals and Bonds

Investing in Stocks

Investing in Mutual Funds

Filters