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Financial Planning Courses: Retirement

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1.
When you start saving for retirement early, you can ride out the various risks in the market better than you could if you started late.
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True. A long time horizon ultimately smooths out the effects of risk.
2.
Social Security benefits are based on _______.
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Average lifetime earnings. Social Security benefits are based on average lifetime earnings and the amount of time you've worked.
3.
When determining your resources for retirement, what should you start with?
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Determine how much income you will get from your current sources of income. The other courses of action should start after this.
4.
Many retirement plans are tax-deferred. What does tax-deferred mean?
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The earnings that build up in them are not taxed until you start making withdrawals. This enables your retirement plan to grow more every year.
5.
Inflation risk, which is the risk that rising prices will erode your money's purchasing power, is a challenge for retired people because _______.
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They usually live on a fixed income. Fixed incomes don't change, so when prices rise, that affects the purchasing power of retired people's money.