CRC Retirement Plan Design 1

Question 1

What is the purpose of a defined benefit plan?

Accepted Answer

To guarantee retirement income

Answer

To provide employer bonuses

Answer

To offer stock options

Answer

To reduce payroll taxes

Question 2

Which plan type allows employee salary deferral?

Accepted Answer

401(k) plan

Answer

Defined benefit plan

Answer

Profit-sharing plan

Answer

Cash balance plan

Question 3

What is a vesting schedule?

Accepted Answer

Ownership timeline for employer contributions

Answer

A retirement age chart

Answer

A tax penalty table

Answer

Health benefit timeline

Question 4

Which plan allows employers to contribute a fixed percentage of salary?

Accepted Answer

Money purchase pension plan

Answer

Deferred annuity

Answer

Roth IRA

Answer

SIMPLE IRA

Question 5

What is a common feature of defined contribution plans?

Accepted Answer

Fixed contributions, uncertain benefit

Answer

Guaranteed retirement benefit

Answer

Fixed monthly payment

Answer

Pension insurance

Question 6

What plan is commonly used by nonprofit organizations?

Accepted Answer

403(b)

Answer

457 plan

Answer

401(k)

Answer

SIMPLE IRA

Question 7

What is a key benefit of automatic enrollment in retirement plans?

Accepted Answer

Encourages employee participation

Answer

Delays contributions

Answer

Reduces matching contributions

Answer

Limits investment options

Question 8

Which agency insures defined benefit pension plans?

Accepted Answer

PBGC

Answer

FDIC

Answer

SBA

Answer

IRS

Question 9

What type of plan provides a lump sum at retirement?

Accepted Answer

Defined contribution plan

Answer

Defined benefit pension

Answer

Deferred compensation plan

Answer

Social Security