CSA Financial Aspects of Aging 2

Question 1

A 72-year-old retiree wants to minimize Required Minimum Distributions (RMDs). Which strategy is most appropriate?

Accepted Answer

Convert traditional IRA funds to a Roth IRA before age 73

Answer

Converting traditional IRA funds to a Roth IRA eliminates future RMDs since Roth IRAs are not subject to RMD rules during the owner's lifetime.

Question 2

Which Medicare supplement (Medigap) plan covers 100% of Medicare Part A coinsurance and hospital costs after benefits are used up?

Accepted Answer

Plan G

Answer

Medigap Plan G covers 100% of Medicare Part A coinsurance and all hospital costs, making it the most comprehensive plan available to new enrollees after Plan F was discontinued.

Question 3

A widow aged 60 wants to claim Social Security survivor benefits. What is the reduction she will face compared to full survivor benefits?

Accepted Answer

28.5%

Answer

Widow(er)s who claim survivor benefits at age 60 receive approximately 71.5% of the deceased spouse's benefit, representing a 28.5% reduction.

Question 4

Which type of trust is commonly used to protect assets from Medicaid spend-down while still allowing the grantor to receive income?

Accepted Answer

Medicaid Asset Protection Trust (MAPT)

Answer

A Medicaid Asset Protection Trust (MAPT) is an irrevocable trust that removes assets from the grantor's countable resources for Medicaid while allowing income to flow to the grantor.

Question 5

What is the primary purpose of a 'spend-down' strategy in Medicaid planning?

Accepted Answer

To reduce countable assets below the Medicaid eligibility threshold

Answer

Medicaid spend-down involves reducing countable assets to the state-defined threshold so a person qualifies for Medicaid long-term care coverage.

Certified Senior Advisor Exam Practice Test

Certified Senior Advisor Exam Practice Test

CSA Financial Aspects of Aging 2