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Financial Literacy - College Savings and Wealth Building Flashcards | StudBud
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Financial Literacy - College Savings and Wealth Building
Financial Literacy - College Savings and Wealth Building
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1
Solve
$4,800
$1,200
$2,400
$5,000
2
Typical retirement plan found in most companies.
Roth IRA
401(k)
ESA
Pension Plans
3
Multiple Choice
8 years
7.2 years
6 years
9 years
4
Multiple Choice.
Have money sent to you and deposit it into a new IRA
Leave it where it is so it can continue to earn interest
Do a direct transfer or rollover into an IRA
Cash it out and invest in mutual funds.
5
Multiple Choince
$2000 per year
$2500 for a child under 18
$0, Not eligible because he has no earned income
$5000
6
Retirement plan found in non-profit groups (schools, hospitals)
403(b)
Pension Plan
401(k)
Roth IRA
7
Multiple Choice.
You maxed out your contribution
You will pay taxes only on the growth of $3000
You have already paid taxes on it so it will grow tax free
Both Red and Blue
8
Multiple Choice
Major career change and temporary drop in income
death or disability
Over 59 and one half years old
First-time home purchase up to $10,000
9
Multiple Choice
Invest the max amount in the Roth IRA then go back to 401(k)
Find another job that offers a retirement plan.
Fully fund 401(k) up to 15% of income
Contribute nothing if there is no match
10
T / F ESA's are a good way to save for college
False
True
11
T / F The Roth IRA is an after-tax investment that grows tax free.
False
True
12
Save for college by 1st using this type of an account
SEPP
UTMA
ESA
403(b)
13
A retirement plan for self-employed peiople
403(b)
Pension Plan
401(k)
SEPP
14
Movement of tax-deferred retirement money from one plan to another.
Rollover
Custodian
Pension
457
15
T / F If you money is in a
pre-tax
plan, you will pay taxes on it when you cash it out.
False
True
16
Multiple Choice
ESA
Pre-paid college tuition
Life Insurance
Savings Bond
17
Manager of a child's or minor's UTMA account or any other bank account.
Bank Manager
Broker
Custodian
SEPP
18
Multiple Choice
IRA allows non-working spouses to contribute, Roth does not.
Traditional IRA grows tax free, Roth does not.
Roth IRA is pre-tax , traditional is after-tax
Roth grows tax free, traditional does not.
19
A deferred compensation plan.
457 Plan
401(k)
UTMA
Roth IRA
20
Multiple Choice
Grows tax free
All of these.
Higher bracket at retirement
Offers more choices
21
T / F 457 plans are designed for employees of non-profit groups like schools and hospitals.
True
False
22
T / F Pre-tax means you invest money after the government takes out taxes.
False
True
23
T / F. You should save for college using savings bonds.
False
True
24
Multiple Choice
$6000 total: $6,000 in 401(k)
$6000 total: $200 in 401(k), $4000 in Roth IRA
$6000 total: $6,000 in Roth IRA
$4000 total: $2000 in 401(k), $2000 in Roth IRA
25
Multiple Choice
If you are forced to leave the company
All of the above.
You die
If you leave the company voluntarily
26
Used after you max out your ESA (Education Savings Account)
Roth IRA
401(k)
UTMA / 529 Plan
Federal Thrift Plan
27
Multiple Choice
Type of investment at a bank
The tax treatement on virtually any type of investment.
Investment that uses pre-tax dollars.
Investment at a firm that has good tax benefits.
28
T / F The maximum contribution amount for a single person is $5000 (as of 2008)
False
True
29
Which Baby Step is College Funding
Baby Step 6
Baby Step 3
Baby Step 5
Baby Step 4
30
Which Baby Step is investing 15% of income for retirement?
Baby Step 4
Baby Step 1
Baby Step 3
Baby Step 2
31
T / F Never roll over your 401(k) when you leave a company.
True
False
32
T / F Dave suggests that you put 10% of your income into retirement plans.
False
True
33
T / F Pension plans work if you contribute to them. If you put nothing in you get nothing out.
False
True
