Retirement Unit Quiz

Tax-deferred means...

• You do not have to pay income tax on the money until you begin to withdraw it at retirement

• You pay income tax on the retirement contributions when you deposit them

• You are never required to pay taxes on your contributions.

• Your employer pays the taxes on your contribution.

What is considered to be "retirement" age, when it is acceptable to begin taking IRA distributions without penalty?

• 50

• 59 1/2

• 65

• 70 1/2

What is the maximum amount you are allowed to contribute to your IRA each year if you are 45 years old?

• $4000

• $6500

• $7500

• $8000

At what age are you required to begin taking distributions from your Roth IRA?

• 65

• 59 1/2

• 70 1/2

• Never

If you leave a company before the required minimum of years to retain your pension, what happens to the money?

• You receive 1/2 of it when you leave the company

• You receive 1/3 of it when you leave the company

• You receive all of the money and can roll it into your new retirement plan

• You don't receive any of the money

What type of employers usually offer pension plans for employees? (a)  

• Government Agencies
• Fast Food Restaurants
• Small Start-ups
• Private Schools

Which of these accounts will NOT change if you switch jobs? (a)  

• IRA
• 401K
• Pension
• Mutual Fund

If your company has a retirement plan,

• You can wait until you are in your 40s to start participating without any costs.

• You should sign up as soon as possible so your investment will start growing.

• Only people who plan on retiring early need to participate in the company plan.

• You should wait until your bills are paid before saving money for retirement.

What percentage of your annual income is it suggested that you invest toward retirement?

• 10%

• 15%

• 20%

• 25%

Which of the below is an employer based retirement plan that only employers contribute to?

• Traditional IRA

• Roth IRA

• 401K

• Pension