Financial Aspects of Aging Flashcards
7 cards from real CSA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Financial Aspects of Aging flashcards as text
A senior advisor is helping a client select a Medicare Part D plan. Which factor is MOST important when comparing plans?
Answer: The total annual cost including premiums, deductibles, and copays for the client's specific medications
The total annual out-of-pocket cost for the individual's specific drug regimen is the most relevant factor, as formularies and cost-sharing vary widely between plans.
What is the 'elimination period' in a long-term care insurance policy?
Answer: The number of days the insured must pay for care before benefits begin
The elimination period is a deductible measured in days during which the policyholder pays for care out-of-pocket before the insurance begins paying.
Which of the following qualified accounts is NOT subject to Required Minimum Distributions (RMDs) during the account owner's lifetime?
Answer: Roth IRA
Roth IRAs are not subject to RMDs during the owner's lifetime, making them a valuable tool for tax-efficient estate planning.
A client aged 65 is newly eligible for Medicare but is still covered by employer group health insurance. What is the PRIMARY rule about Medicare and employer coverage?
Answer: If the employer has 20 or more employees, the employer plan pays primary and Medicare pays secondary
For employers with 20+ employees, the employer group health plan is the primary payer and Medicare is secondary; the reverse applies for employers with fewer than 20 employees.
A 78-year-old client wants to make a charitable gift and reduce her RMD impact. Which strategy achieves both goals?
Answer: Qualified Charitable Distribution (QCD) from her IRA
A Qualified Charitable Distribution (QCD) allows IRA owners age 70½ or older to transfer up to $105,000 annually directly to charity, satisfying RMD requirements without increasing taxable income.
The 'four percent rule' for retirement income withdrawal is based on which underlying assumption?
Answer: A balanced portfolio can sustain 4% annual withdrawals adjusted for inflation over a 30-year period
The 4% rule, derived from the Trinity Study, found that a balanced stock and bond portfolio could sustain inflation-adjusted withdrawals of 4% annually for 30 years with high probability.
Which of the following scenarios would trigger Medicare's 'Income-Related Monthly Adjustment Amount' (IRMAA)?
Answer: A senior's modified adjusted gross income (MAGI) exceeds the annual threshold two years prior
IRMAA surcharges on Medicare Part B and Part D premiums are triggered when a beneficiary's MAGI from two years prior exceeds the annual income threshold.