CRPC Social Security and Pensions 3

Question 1

Social Security delayed retirement credits (DRCs) accrue at what rate per month past full retirement age for those born after 1942?

Accepted Answer

2/3 of 1%

Answer

For those born after 1942, DRCs accrue at 2/3 of 1% per month (8% per year) past full retirement age up to age 70.

Question 2

Under ERISA, what is the maximum period a defined benefit plan may use for final average pay calculations?

Accepted Answer

5 consecutive years

Answer

ERISA limits final average pay formulas to the highest 5 consecutive years of compensation to prevent benefit manipulation.

Question 3

A client born in 1960 wants to know their Social Security full retirement age. What is it?

Accepted Answer

67 years

Answer

For individuals born in 1960 or later, the full retirement age is 67 under current Social Security law.

Question 4

Which type of pension plan requires actuarial assumptions and places the investment risk on the employer?

Accepted Answer

Defined benefit plan

Answer

Defined benefit plans require actuarial assumptions and obligate the employer to fund promised benefits regardless of investment returns.

Question 5

A Social Security claimant has both earned income from wages and receives benefits before FRA. The 2026 annual earnings test exempt amount is $22,320. If she earns $30,320, how much is her benefit withheld?

Accepted Answer

$4,000

Answer

Earnings over the exempt amount ($30,320 - $22,320 = $8,000) are reduced $1 for every $2, so $4,000 is withheld.

CRPC - Chartered Retirement Planning Counselor Practice Test

CRPC - Chartered Retirement Planning Counselor Practice Test

CRPC Social Security and Pensions 3