Exam 14: Planning for Retirement

Self-directed retirement accounts aimed at self-employed persons include:

Of the following survivors of a fully insured worker,_____ would not be eligible for Social Security benefits.

One can contribute up to $10,000 annually to a 401(k)plan.

With a noncontributory pension plan,the employer makes no financial contribution to the account.

Eligibility requirements for pension and retirement plans are typically determined by the employee's age and years of service.

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. -[Any gainfully employed person | Only certain employees] can put money into an IRA.

With a graded vesting schedule over five years,Marianne is likely to keep _____ of her employer's contribution if she leaves her company after four years.

Employer matching contributions are common with _____ plans.

Henry has a defined benefit plan that promises an annual retirement benefit based on 2.5% of his final 5-year average annual salary for each year of service.At retirement Henry has 21 years of service and an average salary over the last 5 years of $95,000.What will his annual benefit be?

An example of a type of plan where the amount the employee receives at retirement is dependent on investment performance is a:

There are early withdrawal penalties for all of the following except:

The amount of benefits received at retirement from your defined contribution retirement portfolio will depend on:

Annuity proceeds are limited to the life of one person.

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. -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.

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

Mary Ann contributed $5,000 to her 401(k)plan.If Mary Ann is in the 15% marginal tax bracket,this retirement contribution saved her approximately _____ in federal income taxes.

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. -The [Roth | traditional] IRA is typically recommended for people in their 30s or 40s.

Qualified pension plans provide employees with tax benefits.

Single premium annuities result in single payment of proceeds.

Reduced early retirement Social Security benefits can be received at age 60.