Choose wisely. There is only one correct answer to each question.
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1.
You may face tax penalties if you fail to take retirement plan distributions after your required retirement age.
True. If you fail to take money out of your plan after you have reached your required retirement age, you will face certain tax penalties.
2.
If your retirement plan is an IRA, you may delay taking required minimum distributions until you retire.
False. If your plan is an IRA, you must begin taking minimum distributions by April 1 following the year you attain age 73, whether or not you are still employed.
3.
If you choose to annually recalculate your life expectancy, you generally will receive larger annuity payments.
False. If you choose to recalculate annually, you generally will receive smaller payments, because when you live another year, your life expectancy increases.
4.
You may take money out of your retirement plan for any reason, at any time without IRS penalty, after you reach the age of _______.
59½. You may take penalty-free distributions from your retirement plan after you reach age 59½.
5.
You may decide to receive your minimum required retirement distribution in monthly, quarterly, annual, or other periodic installments–the choice is up to you.
True. You decide whether to break your required minimum distribution into four, twelve, or however many payments you would like to receive during the year.
6.
All of the following are retirement plans except the _______.
None of the above. Retirement plans include 401(k)s, Keoghs, and individual retirement accounts (IRAs), among others.