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1.
Shawn recently joined a dozen other employees of a small biotechnology company and was glad to learn that under its employer retirement plan, the firm will contribute to an IRA for him. Shawn's new employer offers a _______.
SEP IRA. The simplified employee pension (SEP IRA) enables a company with 25 or fewer employees to establish an IRA for each employee.
2.
Megan's employer, a public technical college, has told her that it will match 100 percent of her contribution to her retirement account. Based on this fact, which of the following plans does she participate in at work?
403(b) plan. Employees of a public college may participate in a 403(b).
3.
Some employer retirement plans enable you to actually lower your current taxable income.
True. Some employer retirement plans enable you to contribute pre-tax dollars to your retirement account.
4.
When you resign or retire from your job, your employer may continue to make contributions to your retirement plan.
False. Your plan is tied to your employment, so employer contributions cease when you leave the organization.
5.
Employee contribution limits to employer retirement plans are subject to yearly adjustments for _______ every year.
Inflation. Contribution limits rise based on inflation.