Practice Test Geeks(CRC) Certified Retirement Counselor Practice Test
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Retirement Income Management Flashcards

7 cards from real CRC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

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  1. What does the term 'mortality credits' refer to in the context of income annuities?

    Answer: The pooling of longevity risk where those who die early subsidize payments to survivors

    Mortality credits arise from risk pooling: annuitants who die early effectively transfer their remaining principal to those who live longer, enabling higher sustainable payments.

  2. Under SECURE 2.0, what is the required beginning date for RMDs for those born in 1951 or later?

    Answer: April 1 of the year following turning age 73

    SECURE 2.0 raised the RMD starting age to 73 for those born between 1951 and 1959, with the age rising to 75 for those born in 1960 or later.

  3. Which retirement income risk is BEST addressed through inflation-indexed Treasury bonds (TIPS) or I-Bonds?

    Answer: Inflation risk

    TIPS and I-Bonds adjust their principal or interest payments with inflation, directly hedging against the risk that rising prices erode purchasing power.

  4. A client wants maximum monthly income from their pension but is worried about their spouse's security. Which option BEST addresses this concern?

    Answer: Life-only option with separate term life insurance to protect the spouse

    Selecting the life-only (highest payout) option and purchasing term life insurance to replace lost pension income for a surviving spouse can maximize household income while protecting the survivor.

  5. What is a Qualified Longevity Annuity Contract (QLAC) and how does it affect RMDs?

    Answer: A deferred income annuity purchased inside a retirement account that reduces the RMD calculation base up to IRS limits

    A QLAC is a deferred income annuity that can be funded with up to a specified IRS limit from a qualified account, removing that amount from the RMD calculation until income begins (up to age 85).

  6. What is the primary advantage of a Roth IRA conversion for a retiree in a low-income year?

    Answer: Paying taxes at a lower marginal rate now to generate tax-free income later

    Converting traditional IRA funds to Roth during a low-income year allows the retiree to pay tax at a lower bracket, creating a tax-free growth and income source for the future.

  7. Which measure captures how much of a pre-retirement income a retiree actually needs to maintain their standard of living?

    Answer: Replacement rate

    The replacement rate is the percentage of pre-retirement income needed in retirement, commonly estimated at 70–90% because some expenses (commuting, retirement savings) cease.