Chp 14: Retirement Savings Flashcards

question

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

Get instant access to
all materials

Become a Member