Question 1

The Old Age Security system allows you to receive reduced benefits if you retire up to five years early.

Accepted Answer

A) True 
 B)False

Question 2

A financial contract that provides guaranteed payments until one's death is

Accepted Answer

A) a life pension. 
B) a life annuity. 
C) a guaranteed RRIF. 
D) a life GIC. 
A) a life pension. 
B) a life annuity. 
C) a guaranteed RRIF. 
D) a life GIC.

Question 3

Phil has a defined-benefit plan that pays him a pension of two percent of his average best three years' earnings.His earnings are as follows: 2008,$58000 ; 2009,$62000 ; 2010,$65000 ; 2011,$66000 ; 2012,$62000 ; 2013,$72000 ; 2014,$75 000.What will be his annual pension benefit if he was with Plastis Co.for 22 years?

Accepted Answer

A) $16 224 
B) $28 789 
C) $31 240 
D) $30 360 
A) $16 224 
B) $28 789 
C) $31 240 
D) $30 360

Question 4

LIRAs and locked-in RRSPs are a lot less flexible than RRSPs because they convert to LIFs and LRIFs and have limits on the amounts that can be withdrawn each year.

Accepted Answer

A) True 
 B)False

Question 5

A registered life annuity has an advantage over a RRIF because you will no longer be exposed to the risk that your funds could run out before your death.

Accepted Answer

A) True 
 B)False

Question 6

If you are far from retirement age and wish to maximize your income in retirement,you should consider investing in

Accepted Answer

A) government bonds or bond funds. 
B) guaranteed investment certificates. 
C) mutual funds with high-growth stocks. 
D) corporate bonds. 
A) government bonds or bond funds. 
B) guaranteed investment certificates. 
C) mutual funds with high-growth stocks. 
D) corporate bonds.

Question 7

Allred Corporation's retirement plan will pay $250 a month for each year worked for the company commencing on the employee's 65th birthday.People must work for the company for 10 years to qualify for the pension.This plan is a

Accepted Answer

A) flat benefit defined-benefit plan. 
B) defined-contribution plan. 
C) LIRA. 
D) unit benefit defined benefit plan. 
A) flat benefit defined-benefit plan. 
B) defined-contribution plan. 
C) LIRA. 
D) unit benefit defined benefit plan.

Question 8

You are a member of a defined-benefit plan that pays a two percent benefit for each year of service based on your best five year's earnings.If you qualify for an unreduced pension and have worked for the company for 30 years,your pension will be approximately

Accepted Answer

A) The answer is unknown because the benefit must be calculated by an actuary. 
B) 60 percent of the average of your best five years' earnings. 
C) 50 percent of the average of your best five years' earnings. 
D) 60 percent of the average of your last five years' earnings. 
A) The answer is unknown because the benefit must be calculated by an actuary. 
B) 60 percent of the average of your best five years' earnings. 
C) 50 percent of the average of your best five years' earnings. 
D) 60 percent of the average of your last five years' earnings.

Question 9

Pending rule changes from the government will require you to be 67 years old (instead of 65)before you can begin collecting Old Age Security retirement benefits.

Accepted Answer

A) True 
 B)False

Question 10

Identify the similarities and differences between RRSP and TFSA accounts and indicate implications.

Accepted Answer

There are many possibilities:
Contributi

Question 11

Which of the following is an important factor to consider in deciding between saving in a TFSA account or an RRSP account?

Accepted Answer

A) Your tax bracket 
B) The appropriate risk level 
C) Tax sheltering of investment income 
D) The types of investment vehicles 
A) Your tax bracket 
B) The appropriate risk level 
C) Tax sheltering of investment income 
D) The types of investment vehicles

Question 12

Which of the following is true regarding pension plans?

Accepted Answer

A) A defined contribution pension plan is the same as an RRSP. 
B) Once you are vested in a pension plan,you can transfer the assets to your RRSP if you leave. 
C) Defined-benefit pension plans are always advantageous,but not defined-contribution plans. 
D) You should take advantage of them because the employer must contribute at least half the funding. 
A) A defined contribution pension plan is the same as an RRSP. 
B) Once you are vested in a pension plan,you can transfer the assets to your RRSP if you leave. 
C) Defined-benefit pension plans are always advantageous,but not defined-contribution plans. 
D) You should take advantage of them because the employer must contribute at least half the funding.

Question 13

To be eligible for Old Age Security retirement benefits,you will need to have worked in Canada for at least 10 years since turning 18.

Accepted Answer

A) True 
 B)False

Question 14

A TFSA is not as good for retirement funding as an RRSP.

Accepted Answer

A) True 
 B)False

Question 15

Tax-free withdrawals from an RRSP for the HBP or LLP

Accepted Answer

A) represent lost contribution room in the future. 
B) must be paid back on schedule or added to your taxable income. 
C) do not affect the compounding of your investments inside the RRSP. 
D) can be paid back to a spousal account instead of the account they were withdrawn from. 
A) represent lost contribution room in the future. 
B) must be paid back on schedule or added to your taxable income. 
C) do not affect the compounding of your investments inside the RRSP. 
D) can be paid back to a spousal account instead of the account they were withdrawn from.

Question 16

A pensioner who only receives Old Age Security income will also receive the maximum Guaranteed Income Supplement.

Accepted Answer

A) True 
 B)False

Question 17

What does Shelley need to save monthly to make sure she is on track to reach her retirement goal of having $440000 saved by the time she reaches age 65? She is 48 years old,has been contributing $400 per month and has $180000 in her RRSP.Assume she will make an annual return of seven percent.

Accepted Answer

A) $1275 
B) $336 
C) $1133 
D) $681 
A) $1275 
B) $336 
C) $1133 
D) $681

Question 18

If Ramzi earned $46 000 from employment,approximately how much will his employer deduct for his CPP contribution? (YMPE $52 500; YBE $3500)

Accepted Answer

A) $207. 
B) $1912 
C) $3825 
D) $4140 
A) $207. 
B) $1912 
C) $3825 
D) $4140

Question 19

Arnie is 21 years old and earning $35 000 annually.If inflation averages three percent annually over his career,what will he have to earn at age 60 to equal his current pay?

Accepted Answer

A) $105 500 
B) $114 171 
C) $128 500 
D) $110 846 
A) $105 500 
B) $114 171 
C) $128 500 
D) $110 846

Question 20

When you are young you should likely invest in investments that have

Accepted Answer

A) lower risk and thus have higher growth potential. 
B) higher risk and thus have lower growth potential. 
C) lower risk and thus have lower growth potential. 
D) higher risk and thus have higher growth potential. 
A) lower risk and thus have higher growth potential. 
B) higher risk and thus have lower growth potential. 
C) lower risk and thus have lower growth potential. 
D) higher risk and thus have higher growth potential.

The Old Age Security system allows you to receive reduced benefits if you retire up to five years early.

A financial contract that provides guaranteed payments until one's death is

LIRAs and locked-in RRSPs are a lot less flexible than RRSPs because they convert to LIFs and LRIFs and have limits on the amounts that can be withdrawn each year.

A registered life annuity has an advantage over a RRIF because you will no longer be exposed to the risk that your funds could run out before your death.

If you are far from retirement age and wish to maximize your income in retirement,you should consider investing in

Allred Corporation's retirement plan will pay $250 a month for each year worked for the company commencing on the employee's 65th birthday.People must work for the company for 10 years to qualify for the pension.This plan is a

You are a member of a defined-benefit plan that pays a two percent benefit for each year of service based on your best five year's earnings.If you qualify for an unreduced pension and have worked for the company for 30 years,your pension will be approximately

Pending rule changes from the government will require you to be 67 years old (instead of 65)before you can begin collecting Old Age Security retirement benefits.

Identify the similarities and differences between RRSP and TFSA accounts and indicate implications.

Which of the following is an important factor to consider in deciding between saving in a TFSA account or an RRSP account?

Which of the following is true regarding pension plans?

To be eligible for Old Age Security retirement benefits,you will need to have worked in Canada for at least 10 years since turning 18.

A TFSA is not as good for retirement funding as an RRSP.

Tax-free withdrawals from an RRSP for the HBP or LLP

A pensioner who only receives Old Age Security income will also receive the maximum Guaranteed Income Supplement.

What does Shelley need to save monthly to make sure she is on track to reach her retirement goal of having $440000 saved by the time she reaches age 65? She is 48 years old,has been contributing $400 per month and has $180000 in her RRSP.Assume she will make an annual return of seven percent.

If Ramzi earned $46 000 from employment,approximately how much will his employer deduct for his CPP contribution? (YMPE $52 500; YBE $3500)

Arnie is 21 years old and earning $35 000 annually.If inflation averages three percent annually over his career,what will he have to earn at age 60 to equal his current pay?

When you are young you should likely invest in investments that have

Tools for Financial Planning - Applying Time Value Concepts

Tools for Financial Planning - Planning with Personal Financial Statements

Tools for Financial Planning - Using Tax Concepts for Planning

Managing Your Financial Resources - Banking Services and Managing Your Money

Managing Your Financial Resources - Assessing,Managing and Securing Your Credit

Managing Your Financial Resources - Purchasing and Financing a Home

Protecting Your Wealth - Auto and Homeowner's Insurance

Protecting Your Wealth - Health and Life Insurance

Personal Investing - Investing Fundamentals

Personal Investing - Investing in Stocks

Personal Investing - Investing in Bonds

Personal Investing - Investing in Mutual Funds

Retirement and Estate Planning - Estate Planning

Synthesis of Financial Planning - Integrating the Components of a Financial Plan

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Exam 5: Retirement and Estate Planning - Retirement Planning

The Old Age Security system allows you to receive reduced benefits if you retire up to five years early.

A financial contract that provides guaranteed payments until one's death is

LIRAs and locked-in RRSPs are a lot less flexible than RRSPs because they convert to LIFs and LRIFs and have limits on the amounts that can be withdrawn each year.

A registered life annuity has an advantage over a RRIF because you will no longer be exposed to the risk that your funds could run out before your death.

If you are far from retirement age and wish to maximize your income in retirement,you should consider investing in

Allred Corporation's retirement plan will pay $250 a month for each year worked for the company commencing on the employee's 65th birthday.People must work for the company for 10 years to qualify for the pension.This plan is a

You are a member of a defined-benefit plan that pays a two percent benefit for each year of service based on your best five year's earnings.If you qualify for an unreduced pension and have worked for the company for 30 years,your pension will be approximately

Pending rule changes from the government will require you to be 67 years old (instead of 65)before you can begin collecting Old Age Security retirement benefits.

Identify the similarities and differences between RRSP and TFSA accounts and indicate implications.

Which of the following is an important factor to consider in deciding between saving in a TFSA account or an RRSP account?

Which of the following is true regarding pension plans?

To be eligible for Old Age Security retirement benefits,you will need to have worked in Canada for at least 10 years since turning 18.

A TFSA is not as good for retirement funding as an RRSP.

Tax-free withdrawals from an RRSP for the HBP or LLP

A pensioner who only receives Old Age Security income will also receive the maximum Guaranteed Income Supplement.

What does Shelley need to save monthly to make sure she is on track to reach her retirement goal of having $440000 saved by the time she reaches age 65? She is 48 years old,has been contributing $400 per month and has $180000 in her RRSP.Assume she will make an annual return of seven percent.

If Ramzi earned $46 000 from employment,approximately how much will his employer deduct for his CPP contribution? (YMPE $52 500; YBE $3500)

Arnie is 21 years old and earning $35 000 annually.If inflation averages three percent annually over his career,what will he have to earn at age 60 to equal his current pay?

When you are young you should likely invest in investments that have

Tools for Financial Planning - Applying Time Value Concepts

Tools for Financial Planning - Planning with Personal Financial Statements

Tools for Financial Planning - Using Tax Concepts for Planning

Managing Your Financial Resources - Banking Services and Managing Your Money

Managing Your Financial Resources - Assessing,Managing and Securing Your Credit

Managing Your Financial Resources - Purchasing and Financing a Home

Protecting Your Wealth - Auto and Homeowner's Insurance

Protecting Your Wealth - Health and Life Insurance

Personal Investing - Investing Fundamentals

Personal Investing - Investing in Stocks

Personal Investing - Investing in Bonds

Personal Investing - Investing in Mutual Funds

Retirement and Estate Planning - Estate Planning

Synthesis of Financial Planning - Integrating the Components of a Financial Plan

Filters