Question 1

Social Security benefits do not increase even if the cost of living increased during the preceding year.

Accepted Answer

A) True 
 B)False

Question 2

Which one of the following is not a private source of retirement income?

Accepted Answer

A)  Traditional IRAs
B)  Social Security
C)  Defined contribution plans
D)  Defined benefit plans
E)  Spousal IRAsF) A) and B)
G) C) and E)

Question 3

In a Roth IRA,contributions are not tax deductible,but earnings accumulate tax free.

Accepted Answer

A) True 
 B)False

Question 4

Which is correct with respect to life expectancy?

Accepted Answer

A)  Men have a longer life expectancy than women at age 65.
B)  There is no difference in life expectancy between men and women at age 65.
C)  Women have a longer life expectancy than men at age 65.
D)  There is no difference in life expectancy among retirees in retirement communities at age 65.
E)  At age 65,the average life expectancy for a man is 25 years.F) B) and E)
G) A) and C)

Question 5

Inflation increases the purchasing power of your retirement savings.

Accepted Answer

A) True 
 B)False

Question 6

What type of annuity is generally purchased by people of retirement age?

Accepted Answer

A)  Deferred annuity
B)  Immediate annuity
C)  Single-premium deferred annuity
D)  Flexible-premium deferred annuity
E)  Keogh annuityF) B) and D)
G) A) and D)

Question 7

The Social Security Administration provides a history of your earnings and an estimate of your future monthly benefits online.

Accepted Answer

A) True 
 B)False

Question 8

Why is it important to review your assets and liabilities before your retirement?

Accepted Answer

Reviewing your assets and liabilities is...

Question 9

Explain the difference between a defined-contribution and defined-benefit plan.

Accepted Answer

Answers will vary.A defined-contribution...

Question 10

Profit-sharing plans and 401(k)plans are examples of defined-contribution plans.

Accepted Answer

A) True 
 B)False

Question 11

Which federal law sets minimum standards for pension plans in private industry and protects more than 50 million workers?

Accepted Answer

A)  Employee Retirement Income Security Act
B)  Tax Reform Act
C)  Early Retirement Act
D)  Income Protection and Guarantee Act
E)  Civil Rights ActF) A) and B)
G) A) and C)

Question 12

You can get a reverse annuity mortgage if:

Accepted Answer

A)  you are willing to sell your house immediately.
B)  you buy a new home and pay only a minimal down payment.
C)  your mortgage is largely or completely paid off.
D)  you owe more in monthly mortgage interest than the annuity amount.
E)  you are willing to allow your principal mortgage balance to increase monthly.F) A) and D)
G) A) and B)

Question 13

According to the Securities and Exchange Commission,one of the easiest ways to boost your retirement savings is:

Accepted Answer

A)  apply for Social Security
B)  save by regular,automatic deductions from your paycheck
C)  move to less expensive housing
D)  rent out a room in your house
E)  begin saving a lot when you reach age 45F) None of the above
G) A) and D)

Question 14

Which of the following is not a question that will help assess your financial condition as you approach retirement?

Accepted Answer

A)  Do you know where your health insurance will come from after retirement?
B)  Do you save according to your retirement plan,shifting from safe investments to risky,growth type investments?
C)  Do you have your own credit history?
D)  Do you talk regularly and frankly to family members about retirement finances?
E)  Do you know where you plan to live in retirement?F) A) and B)
G) A) and C)

Question 15

Social Security is a package of protection,providing retirement,survivors',and disability benefits.

Accepted Answer

A) True 
 B)False

Question 16

At a 3 percent rate of inflation,approximately how many years will it take for prices to double?

Accepted Answer

A)  9 years
B)  15 years
C)  21 years
D)  24 years
E)  30 yearsF) A) and E)
G) A) and D)

Question 17

Your Social Security benefits may be reduced if you earn above a certain amount a year,depending on your age and the amount you earn.

Accepted Answer

A) True 
 B)False

Question 18

Sarah Logan is a professor at a public university.Her employer makes nontaxable contributions to a plan in her name and reduces her salary by the same amount.What type of retirement plan does Sarah have?

Accepted Answer

A)  Money-purchase pension plan
B)  Stock bonus plan
C)  Profit-sharing plan
D)  Defined benefit plan
E)  403(b) planF) A) and B)
G) B) and D)

Question 19

Your Social Security payments will start at age 65 whether you apply for benefits or not.

Accepted Answer

A) True 
 B)False

Question 20

People born after 1928 need at least how many quarters of coverage to qualify for Social Security benefits?

Accepted Answer

A)  20
B)  40
C)  60
D)  80
E)  100F) C) and D)
G) B) and E)

Exam 18: Starting Early: Retirement Planning

What type of annuity is generally purchased by people of retirement age?

Correct AnswerverifiedShow Answer

Inflation increases the purchasing power of your retirement savings.

Correct AnswerverifiedShow Answer

Your Social Security payments will start at age 65 whether you apply for benefits or not.

Correct AnswerverifiedShow Answer

According to the Securities and Exchange Commission,one of the easiest ways to boost your retirement savings is:

Correct AnswerverifiedShow Answer

Which one of the following is not a private source of retirement income?

Correct AnswerverifiedShow Answer

Social Security benefits do not increase even if the cost of living increased during the preceding year.

Correct AnswerverifiedShow Answer

Which of the following is not a question that will help assess your financial condition as you approach retirement?

Correct AnswerverifiedShow Answer

In a Roth IRA,contributions are not tax deductible,but earnings accumulate tax free.

Correct AnswerverifiedShow Answer

Why is it important to review your assets and liabilities before your retirement?

Correct AnswerverifiedReviewing your assets and liabilities is...View AnswerShow Answer

Sarah Logan is a professor at a public university.Her employer makes nontaxable contributions to a plan in her name and reduces her salary by the same amount.What type of retirement plan does Sarah have?

Correct AnswerverifiedShow Answer

The Social Security Administration provides a history of your earnings and an estimate of your future monthly benefits online.

Correct AnswerverifiedShow Answer

Which is correct with respect to life expectancy?

Correct AnswerverifiedShow Answer

People born after 1928 need at least how many quarters of coverage to qualify for Social Security benefits?

Correct AnswerverifiedShow Answer

You can get a reverse annuity mortgage if:

Correct AnswerverifiedShow Answer

Profit-sharing plans and 401(k)plans are examples of defined-contribution plans.

Correct AnswerverifiedShow Answer

Your Social Security benefits may be reduced if you earn above a certain amount a year,depending on your age and the amount you earn.

Correct AnswerverifiedShow Answer

Which federal law sets minimum standards for pension plans in private industry and protects more than 50 million workers?

Correct AnswerverifiedShow Answer

At a 3 percent rate of inflation,approximately how many years will it take for prices to double?

Correct AnswerverifiedShow Answer

Social Security is a package of protection,providing retirement,survivors',and disability benefits.

Correct AnswerverifiedShow Answer

Explain the difference between a defined-contribution and defined-benefit plan.

Correct AnswerverifiedAnswers will vary.A defined-contribution...View AnswerShow Answer

Correct Answer
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Reviewing your assets and liabilities is...
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Answers will vary.A defined-contribution...
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