Chp 14: Retirement Savings Flashcards
Unlock all answers in this set
Unlock answersquestion
T/F: it really makes a difference whether you start retirement savings at age 25 or at age 45.
answer
False
question
T/F: by itself, social security is sufficient to allow a worker and spouse to maintain their pre-retirement standard of living.
answer
False
question
T/F: even the best retirement plan needs to be reviewed every few years.
answer
True
question
T/F: the first step in retirement planning is to identify retirement goals.
answer
True
question
T/F: self-employer workers pay twice as much for social security coverage compared to employed workers
answer
True
question
the major mistake(s) people make in retirement planning is(are) . . .
answer
saving too little
question
T/F: supplemental retirement plans are usually voluntary.
answer
True
question
T/F: social security benefits alone can usually fund comfortable retirement.
answer
False
question
annuities are administered by . . .
answer
life insurance companies
question
the cost of an annuity varies with the . . .
answer
age of the annuitant at issue, age of the annuitant when payment begins, method of proceeds distribution, and sex of annuitant.
question
when setting retirement goals you should consider . . .
answer
what you want to do in retirement, your expected standard of living, your proposed level of income, and special retirement activities and projects.
question
the amount of money in your defined contribution retirement portfolio will depend on . . .
answer
the age at which you begin contribution, the amount of money you deposit each month, and the rate of return on your savings.
question
T/F: individuals are being forced to assume more and more responsibility for their own retirement.
answer
True
question
T/F: most people are too conservative when investing their retirement funds.
answer
True
question
T/F: government assistance primarily social security, is the largest single source of income for the average retiree.
answer
True
question
a Roth IRA . . .
answer
is funded with after tax dollars, allows interest or dividends to accrue tax free, permits you to withdraw your contribution at any time, and provides for tax-free earnings if you hold account 5 years and are 59.5 at withdraw.
question
the need for retirement planning is increased by the uncertainties of . . .
answer
inflation, social security benefits, assets you hold, and your pension benefits.
question
funds to finance social security comes from . . .
answer
compulsory contributions from employee, employer, and self employed
question
the major financial benefits of beginning your retirement funding early is related to . . .
answer
increase cost of living
question
the proceeds of a variable annuity are dependent on the . . .
answer
investment return
question
T/F: if one is unsure about the facts needed to estimate retirement needs, it is better to do nothing for a few years.
answer
False
