What is the primary purpose of a 401(k) retirement plan?
Correct!
Wrong!
A 401(k) is an employer-sponsored retirement account that allows employees to contribute pre-tax income and grow savings tax-deferred.
Which type of IRA allows for tax-free withdrawals in retirement?
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Wrong!
Roth IRAs are funded with after-tax dollars, and qualified withdrawals in retirement are completely tax-free.
What is the purpose of a will in estate planning?
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Wrong!
A will is a legal document that outlines how a person's assets will be distributed after their death.
Which document appoints someone to manage financial affairs if you're incapacitated?
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Wrong!
A durable power of attorney designates a trusted individual to make financial decisions if the grantor is unable to do so.
What is the main advantage of a trust in estate planning?
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A trust allows assets to be distributed to beneficiaries without going through probate, which can save time and legal costs.
When should retirement planning ideally begin?
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Starting retirement planning early allows for greater compounding of investment returns and more flexibility in achieving goals.