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Financial Planning Courses: Retirement

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1.
It is possible to have your employer add its own money to a retirement account.
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True. If you have a 401k plan, your employer might make contributions to it on your behalf. This is one reason 401k plans are so popular.
2.
When prices of goods and services rise over time and eat into your money's purchasing power, that is called _______ risk.
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Inflation. Inflation risk is the risk that rising prices will make it harder to buy the things you need.
3.
Why is it necessary to consider what inflation will do to your income?
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The effects of inflation will require that you use more money to maintain your current standard of living. If you want to keep up your current level of comfort, you will need to assess the impact of inflation on your nest egg.
4.
Social Security is a program that pays benefits for _______.
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Retirement. Social Security is a retirement program.
5.
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.