Retirement Planning Flashcards
6 cards from real RIA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Retirement Planning flashcards as text
A Traditional IRA contribution may be tax-deductible depending on:
Answer: Whether the investor or spouse has access to a workplace retirement plan and their income level
Traditional IRA deductibility phases out for those covered by workplace retirement plans above certain income thresholds.
The primary advantage of a Roth IRA over a Traditional IRA is:
Answer: Tax-free growth and tax-free qualified withdrawals in retirement
Roth IRA contributions are made with after-tax dollars, but qualified withdrawals in retirement are completely tax-free.
Required Minimum Distributions (RMDs) from Traditional IRAs must begin by:
Answer: April 1 of the year following the year the account holder turns 73
Under SECURE Act 2.0, RMDs must begin by April 1 following the year an account holder turns 73.
A 401(k) plan offers which key tax advantage?
Answer: Pre-tax contributions reduce current taxable income, with taxes deferred until withdrawal
Traditional 401(k) contributions are made pre-tax, reducing current taxable income with taxes deferred until retirement withdrawal.
The 'stretch IRA' strategy was largely eliminated by:
Answer: The SECURE Act of 2019
The SECURE Act (2019) eliminated the stretch IRA for most non-spouse beneficiaries, requiring inherited IRA distributions within 10 years.
SEP-IRA plans are primarily designed for:
Answer: Self-employed individuals and small business owners
Simplified Employee Pension (SEP) IRAs are designed for self-employed individuals and small business owners seeking a simple, high-contribution retirement plan.
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