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Social Security benefits are based on a number of things. Which of the following is NOT one of them?

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Your financial need

Your average lifetime earnings

The amount of time you've worked

Your financial need. Financial need does not determine the benefits you get from Social Security. Your earnings and amount of time worked determine your benefits.

Long time horizons generally enable us to assume _______ short-term ones.

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More risk than

Less risk than

The same risk as

More risk than. Time reduces risk.

The government has done its part to help you save for retirement by _______.

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Allowing you to set up tax-deferred retirement accounts

Reducing taxes on the elderly

Increasing monthly payments to those who have high living expenses

Allowing you to set up tax-deferred retirement accounts. Accounts such as 401(k) plans and individual retirement accounts (IRAs) grow tax-deferred.

It is possible to have your employer add its own money to a retirement account.

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True

False

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.

If you live longer than expected, you may face a number of different risks associated with your elder years. Which risk refers specifically to living longer than expected?

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Inflation risk

Longevity risk

Healthcare costs risk

Long-term care risk

Longevity risk. Longevity risk is the risk that you will live longer than is expected. It can lead to a lot of challenges if it is not planned for.

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