Exam 14: Planning for Retirement

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. -Judy,age 68,is receiving Social Security benefits.She received $45,000 in consulting income this year.Her Social Security benefits [will | will not] be reduced because of these earnings.

Earnings limitations on Social Security benefits cease at age:

Whether or not Social Security benefits will be subject to income taxes depends on the age of the recipient.

Major sources of retirement income include:

The amount accumulated in a defined contribution plan will be determined,at least in part,by the investment performance of the retirement funds.

If you make a withdrawal from an IRA account before age 57 1/2,you generally owe a 20% penalty on that amount.

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. -Social Security alone [will | will not] provide a comfortable standard of living at retirement.

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. -You are age 45 and healthy,and you are withdrawing money from your IRA.There [will | will not] be a tax penalty for doing this.

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. -[Social Security | 401k] is the single largest source of income for the average U.S.retiree.

ERISA was passed to protect employees participating in private employer retirement plans.

Fully insured status requires 40 ____ of employment covered by Social Security.

Payments from a defined benefits plan will be determined by the investment performance of the retirement funds.

Asset income is the principal source of retirement income for any individual.

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 invest their retirement funds too [aggressively | conservatively].

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. -[401(k)| 403(b)] plans would be available for employees of a public,nonprofit organization.

The current trend in retirement plans is toward contributory plans.

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. -Vested rights are [forfeitable | nonforfeitable] rights to receive some pension benefits.

The first step in retirement planning is to identify retirement goals.

When setting retirement goals you should consider:

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. -Under a defined contribution pension plan,an employee [is | is not] able to estimate what his pension payment would be upon retirement.