Question 1

A company using cliff vesting would legally have to give you vesting rights if you worked at a company 3 or more years.

Accepted Answer

A) True 
 B)False

Question 2

Social security benefits alone can usually fund a comfortable retirement.

Accepted Answer

A) True 
 B)False

Question 3

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-[Any gainfully employed person | Only certain employees] can put money into an IRA.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 4

Normal retirement age is typically defined as ____ years of age.

Accepted Answer

A)  50 
B)  55 
C)  60 
D)  65 
E)  70 
A)  50 
B)  55 
C)  60 
D)  65 
E)  70

Question 5

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?

Accepted Answer

Retirement

Question 6

Annuities may guarantee proceeds for a specific period or for a specific amount.

Accepted Answer

A) True 
 B)False

Question 7

Employee contributions to ____ plans do not reduce taxable income.

Accepted Answer

A)  403(b) 
B)  Thrift and savings 
C)  457 
D)  401(k) 
E)  a,b,and c 
A)  403(b) 
B)  Thrift and savings 
C)  457 
D)  401(k) 
E)  a,b,and c

Question 8

Workers who elect to retire early-at age 62-will receive reduced Social Security benefits,currently ________ of the full amount

Accepted Answer

A)  20% to 30% 
B)  50% to 60% 
C)  60% to 70% 
D)  70% to 80% 
E)  80% to 90% 
A)  20% to 30% 
B)  50% to 60% 
C)  60% to 70% 
D)  70% to 80% 
E)  80% to 90%

Question 9

Which is not a common mistake people make when planning for retirement?

Accepted Answer

A)  starting too late 
B)  putting away too little 
C)  assuming too much risk 
D)  having too little when reaching retirement 
E)  none of the above 
A)  starting too late 
B)  putting away too little 
C)  assuming too much risk 
D)  having too little when reaching retirement 
E)  none of the above

Question 10

The median household approaching retirement has less than 25 percent of the money needed to maintain their standard of living in retirement.

Accepted Answer

A) True 
 B)False

Question 11

Jason just quit his current job.He has $13,000 vested in that 401(k)plan.Which of the following is true?

Accepted Answer

A)  If Jason takes the money and spends it,he will have to pay taxes and penalties on all $13,000. 
B)  If Jason takes the money and reinvests it in an IRA,the employer will write him a check for $13,000. 
C)  If Jason arranges a transfer of funds from his employer directly to his IRA trustee,his employer will withhold 20%. 
D)  a and b 
E)  a,b,and c 
A)  If Jason takes the money and spends it,he will have to pay taxes and penalties on all $13,000. 
B)  If Jason takes the money and reinvests it in an IRA,the employer will write him a check for $13,000. 
C)  If Jason arranges a transfer of funds from his employer directly to his IRA trustee,his employer will withhold 20%. 
D)  a and b 
E)  a,b,and c

Question 12

Sally and Patrick are married with 4 young children.Patrick stays at home with the kids while Sally works as CEO of a small manufacturing firm earning $105,000 annually.Sally is covered by a 401(k)plan at work,but they would like to maximize their IRA contributions as well.Which of the following are true assuming their AGI is $105,897?

Accepted Answer

A)  Sally and Patrick could each contribute $3,000 to a Roth IRA. 
B)  Sally and Patrick could each contribute $3,000 to a deductible traditional IRA. 
C)  Only Sally can contribute to any type of IRA.Patrick has no earned income. 
D)  Patrick could contribute $3,000 to either a deductible tradition IRA or a Roth IRA. 
E)  a and d 
A)  Sally and Patrick could each contribute $3,000 to a Roth IRA. 
B)  Sally and Patrick could each contribute $3,000 to a deductible traditional IRA. 
C)  Only Sally can contribute to any type of IRA.Patrick has no earned income. 
D)  Patrick could contribute $3,000 to either a deductible tradition IRA or a Roth IRA. 
E)  a and d

Question 13

Melissa's retirement plan is described in her employee handbook as follows:   Which of the following statements about this retirement plan is(are)true?

Accepted Answer

A)  Melissa will have to contribute to the plan. 
B)  If Melissa leaves this company before working full-time for 3 years,she will not receive any benefits. 
C)  Melissa will have to make investment decisions regarding her retirement plan. 
D)  This is a defined contribution plan. 
E)  All of the above. 
A)  Melissa will have to contribute to the plan. 
B)  If Melissa leaves this company before working full-time for 3 years,she will not receive any benefits. 
C)  Melissa will have to make investment decisions regarding her retirement plan. 
D)  This is a defined contribution plan. 
E)  All of the above.

Question 14

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 15

A large selection of investment types can qualify as IRA investments.

Accepted Answer

A) True 
 B)False

Question 16

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Under a defined benefit pension plan,an employee [is | is not] able to estimate what his pension payment would be upon retirement.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 17

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-A defined [contribution | benefit] retirement plan would usually be better for an older worker who has been employed for a long time with the same employer.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 18

Like Keogh Plans,SEP plans are only for self-employed persons with no employees.

Accepted Answer

A) True 
 B)False

Question 19

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-A self-employed person could set up a [Keogh | 403(b)] retirement plan.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 20

Age 65 is typically the "normal retirement" age on retirement plans.

Accepted Answer

A) True 
 B)False

A company using cliff vesting would legally have to give you vesting rights if you worked at a company 3 or more years.

Social security benefits alone can usually fund a comfortable retirement.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -[Any gainfully employed person | Only certain employees] can put money into an IRA.

Normal retirement age is typically defined as ____ years of age.

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?

Annuities may guarantee proceeds for a specific period or for a specific amount.

Employee contributions to ____ plans do not reduce taxable income.

Workers who elect to retire early-at age 62-will receive reduced Social Security benefits,currently ________ of the full amount

Which is not a common mistake people make when planning for retirement?

The median household approaching retirement has less than 25 percent of the money needed to maintain their standard of living in retirement.

Jason just quit his current job.He has $13,000 vested in that 401(k)plan.Which of the following is true?

Melissa's retirement plan is described in her employee handbook as follows: Which of the following statements about this retirement plan is(are)true?

The purpose of the social security retirement program is to

A large selection of investment types can qualify as IRA investments.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Under a defined benefit pension plan,an employee [is | is not] able to estimate what his pension payment would be upon retirement.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -A defined [contribution | benefit] retirement plan would usually be better for an older worker who has been employed for a long time with the same employer.

Like Keogh Plans,SEP plans are only for self-employed persons with no employees.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -A self-employed person could set up a [Keogh | 403(b)] retirement plan.

Age 65 is typically the "normal retirement" age on retirement plans.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

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

A company using cliff vesting would legally have to give you vesting rights if you worked at a company 3 or more years.

Social security benefits alone can usually fund a comfortable retirement.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -[Any gainfully employed person | Only certain employees] can put money into an IRA.

Normal retirement age is typically defined as ____ years of age.

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?

Annuities may guarantee proceeds for a specific period or for a specific amount.

Employee contributions to ____ plans do not reduce taxable income.

Workers who elect to retire early-at age 62-will receive reduced Social Security benefits,currently ________ of the full amount

Which is not a common mistake people make when planning for retirement?

The median household approaching retirement has less than 25 percent of the money needed to maintain their standard of living in retirement.

Jason just quit his current job.He has $13,000 vested in that 401(k)plan.Which of the following is true?

Melissa's retirement plan is described in her employee handbook as follows: Which of the following statements about this retirement plan is(are)true?

The purpose of the social security retirement program is to

A large selection of investment types can qualify as IRA investments.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Under a defined benefit pension plan,an employee [is | is not] able to estimate what his pension payment would be upon retirement.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -A defined [contribution | benefit] retirement plan would usually be better for an older worker who has been employed for a long time with the same employer.

Like Keogh Plans,SEP plans are only for self-employed persons with no employees.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -A self-employed person could set up a [Keogh | 403(b)] retirement plan.

Age 65 is typically the "normal retirement" age on retirement plans.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

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