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Retirement Intermediate:
Retirement Investing Strategies
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Choose wisely. There is only one correct answer to each question.
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1.
An investment's volatility over the long term generally _______ compared to its volatility over the short term.
Choose wisely. There is only one correct answer.
Increases
Decreases
Stays the same
Decreases. Volatility generally decreases when comparing longer investment periods to shorter ones.
2.
Long time horizons generally enable us to assume _______ short-term ones.
Choose wisely. There is only one correct answer.
More risk than
Less risk than
The same risk as
More risk than. Time reduces risk.
3.
If you still have a long time before you retire, you may want to consider _______.
Choose wisely. There is only one correct answer.
More aggressive long-term investments
More conservative long-term investments
More aggressive short-term investments
More aggressive long-term investments. The younger you are, the more risk you might be willing and able to assume with your investments.
4.
You will be penalized for withdrawing money from pension plans before age 73.
Choose wisely. There is only one correct answer.
True
False
False. You will be penalized if you withdraw your retirement money before age 59½.
5.
If you want the safety of low-volatility investments, you will have to accept ________ as well.
Choose wisely. There is only one correct answer.
Low risk
Lower returns
Certificates of deposit
Lower returns. As a rule, the lower the volatility of an investment, the lower the potential return.
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