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Retirement Intermediate: Tax-Deferred Retirement Plans

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1.
In the language of retirement plans, the term "pre-tax" means that _______.
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Money contributed to the plan is not to be taxed in the current year (until withdrawn). "Pre-tax" means that it is meant to not be taxed currently.
2.
Of the following, the retirement savings option that gives protection from taxes in the current year is ______.
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Pre-tax/tax-deferred. With pre-tax, tax-deferred plans, you do not pay taxes on the income you contribute, and your earnings grow tax-free.
3.
If you are not covered by a qualified retirement plan at work, your IRA contributions can be tax-deductible.
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True. Your IRA contributions can be tax-deductible if you meet income requirements.
4.
Who might be eligible to participate in a SIMPLE?
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The checkout boy at Bob's Corner Bakery. Only companies with 100 or fewer employees can participate in a SIMPLE plan.
5.
What is the maximum percentage of your income that you can contribute to a Keogh plan?
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100%. You can contribute up to 100%, up to a yearly dollar maximum.
6.
Annuities don't offer the same tax protection as 401(k) plans.
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True. While annuities are tax-deferred, there is no tax protection on the income you invest in them–unlike in 401(k) plans.
7.
Once you contribute to a 401(k) plan, you must remain in the plan until you retire.
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False. You can take the money out and put it into a different retirement account if you change jobs.