Retirement Plans/Funds

You can begin withdrawing IRA funds at anytime without incurring additional taxes or penalties.

• True

• False

Traditional IRA's give you tax benefits now while Roth IRA's give you benefits in retirement.

• True

• False

John's company will match his pre-tax contributions to the company's retirement plan, known as:

• A 401(k)

• A Roth IRA

• A defined benefit plan

• A traditional IRA

After five years of owning a Roth Individual Retirement Account (IRA), a person wants to buy his first home, the person can withdraw money from the Roth IRA

• A. tax and penalty free

• B. must pay a set penalty at the time of withdrawal

• C. have penalties deferred until retirement

• owed taxed are deferred until retirement

A company offers a defined-contribution pension plan which means that upon retirement the employee will receive

• A: one-half of the employee's last year's salary.

• B: the total amount of money contributed plus investment earnings.

• C: an amount of money based only on the length of time the employee worked for the company.

• D: a specified amount of money based totally on the profit earned by the company while the employee worked there.

An example of a Defined Benefit Plan would be

• A Roth IRA

• A Traditional IRA

• A pension plan

• A 401-K Plan

An 401-K plan is an example of a Defined Contribution Plan.

• True

• False

This type of retirement plan favors older workers who work for the same company for many years. It guarantees monthly income payments to the retiree.

• A 401-K Plan

• A pension

• A Roth IRA

• A Traditional IRA

The only retirement plan that is not tax-deferred (meaning it has already been taxed.)

• A pension plan

• A Roth IRA

• A Traditional IRA

• A 401-k Plan

A Roth IRA requires you to take minimum distributions at 70-1/2.

• True

• False