Practice Test GeeksCRPC - Chartered Retirement Planning Counselor Practice Test
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Retirement Income and Management Flashcards

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

Read the first 7 Retirement Income and Management flashcards as text

  1. Which withdrawal strategy involves taking only the income (interest and dividends) generated by a portfolio without touching principal?

    Answer: Income-only strategy

    The income-only strategy preserves principal by limiting withdrawals to interest, dividends, and other portfolio income.

  2. A retiree uses the 'floor-and-upside' approach. What does the 'floor' represent?

    Answer: Guaranteed income covering essential expenses

    The 'floor' consists of guaranteed income sources (Social Security, pensions, annuities) designed to cover essential, non-discretionary expenses.

  3. What is 'sequence of returns risk' most problematic for retirees compared to accumulators?

    Answer: Early negative returns permanently reduce the portfolio while withdrawals continue

    For retirees making withdrawals, early poor returns deplete the portfolio before it can recover, permanently impairing the income stream.

  4. Which annuity payout option provides income for the longer of two lives, with payments continuing to the survivor?

    Answer: Joint and survivor annuity

    A joint and survivor annuity continues payments as long as either annuitant is alive, protecting the surviving spouse.

  5. Under IRS rules, what is the penalty for failing to take a required minimum distribution (RMD) on time?

    Answer: 25% excise tax on the amount not distributed

    The SECURE 2.0 Act reduced the RMD failure penalty to 25% (down from 50%) of the amount that should have been distributed.

  6. Which of the following best describes a 'longevity annuity' (QLAC)?

    Answer: A deferred income annuity that begins payments at an advanced age such as 80 or 85

    A QLAC (Qualified Longevity Annuity Contract) is a deferred income annuity designed to provide income starting at an advanced age, hedging longevity risk.

  7. When coordinating retirement income sources, which strategy generally maximizes lifetime Social Security benefits for a healthy married couple?

    Answer: The higher earner delays to age 70; the lower earner claims earlier

    Having the higher earner delay to age 70 maximizes the permanent survivor benefit, while the lower earner can claim earlier to provide interim income.