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1.
A defined contribution plan provides you _______ at retirement.
A lump sum of money. You are given a lump sum of money, but you can convert it into an annuity if you wish.
2.
When calculating the expenses you will have during retirement, you should calculate them using _______.
Inflation-adjusted dollars. Prices rise over time due to inflation; you must therefore adjust your expenses for inflation. An inflation table factor or a financial calculator can help you do that.
3.
By examining your present mode of living and making adjustments, you can determine your retirement needs.
True. By looking at your present lifestyle, you can determine what you will need to live on in retirement.
4.
A list of retirement expenses will include many of the same things you spend money on right now.
True. Some expenses, such as medical bills, may be higher in your later years.
5.
Once retired, you will not need to pay taxes.
False. In most cases, you will continue to have to pay taxes.