IRA's

Question 1

• Available through an individual employer
• Sometimes allow the employer to contribute to its employees accounts

Answer 1

Company-Sponsored Retirement Plans

Question 2

isa free service that allows you to transfer funds between your Schwab brokerage account and other financial institutions, at regularly scheduled intervals and/or upon request

Answer 2

Schwab MoneyLink®

Question 3

Certain Schwab One account features are _____ available for an IRA, including:

• VISA debit privileges
• Schwab BillPay Services
• Margin

Question 4

• Offer tax-sheltered growth for qualified distributions
  
  • this means that investments can grow free of federal income taxes
  • No RMD at 72

Answer 4

Roth IRA

Must have had the account opened for 5 years before taking a distribution, otherwise a 10% penalty is incurred.

Question 5

James is 22 and just started his first job after college but wants to gert started now in investing for his retirement. What kind of IRA should James consider?

Answer 5

a Roth IRA

Why?

James is new to his career and hopefully will make more money the longer he works. So contributions made now will be taxed at a lower rate then say 20 years into his career.

Question 6

Best Suited For:

An individual who expects to be in a lower tax bracket when they start taking withdraws

Answer 6

Traditional IRA

Question 7

These plans may be established for small businesses with any number of employees

• However, Sole Props with 0 employees often open these accounts

Answer 7

SEP-IRA

Question 8

This pre-tax deferral plan (Plus minimal employer contributions) is available for small businesses having up to 100 employees making $5,000 or more annually.

• Employers are required to contribute either a match up to 3%or a 2% nonelective contribution for each eligible employee

Answer 8

Simple IRA

Question 9

Is designed for self-employed individuals/owner-only businesses and their spouses

In many cases, this plan allows small business owners to contribute more than other plan types such as SEPs

Answer 9

Individual 401(k)

Question 10

Define-contribution plan, where employees contribute a defined amount each pay period

Answer 10

401(k) plans

Question 11

Retirement accounts typically only offered through government employers and non-profit organizations

• Very similar to 401(k)s

Answer 11

457 Plans

Question 12

a retirement plan offered by public schools and certain 501(c)(3) tax-exempt organizations

• Employees save for retirement by contributing to individual accounts.
• Employers can also contribute to employees’ accounts.
• also called a tax-sheltered annuity or TSA plan

Answer 12

403(b)

Question 13

Converts retirement savings into a regular monthly stream of income

Answer 13

Guaranteed Income Annuities

Question 14

30 Large, Established & Actively Traded U.S. Stocks

Answer 14

The Dow

Question 15

Top 500 U.S. Headquartered Companies based off Market Cap

• over $6.1 Billion in Market Cap

Answer 15

S&P 500

Question 16

Made up of 3,000 stocks.

Mostly Tech-based Companies

Answer 16

Nasdaq

Question 17

an order to buy or sell a stock at the market’s current best available price

• Ensures an execution but +does not* guarantee a *specific price
• Generally, should only be placed during market hours (To avoid the price going down or up significantly after placing the order)

Answer 17

Market Order

Question 18

When placing a bid, limits the buy price. When placing an ask, sets the minimum price to be received

Answer 18

Limit Order

Question 19

• If the order is filled, it will only be at the specific limit price or better.
• No assurance of execution
• appropriate when you think you can buy at a lower than - or sell at a price higher than - the current quote

Answer 19

Limit Order

Question 20

once a client turns ____, they may begin taking distributions from their IRA account without penalty

Answer 20

59 1/2

If a Roth IRA the account must also have been established for at least 5 years

Question 21

• Early Distributions - Subject to a 10% early withdrawal penalty
  
  • Unless it is, Rolled Over to an eligible retirement plan within 60 days of receiving a check
  • Directly transferred to another IRA

Answer 21

Traditional Contributory IRA

Question 22

Minimum amount that an IRA owner must withdrawal yearly, starting the year they turn 72 (73 starting 2023).
The distribution must be made by Dec 31 each year

• For the year in which they turn 73 they have until April 1st to take their first distribution.

Answer 22

RMD

Amounts may be aggregated and distributed from a single retirement account or multiple accounts

Can request a check for cash or can journal stock to another brokerage account (will be taxed, which is the point of an RMD)

Question 23

once a client reaches ____, and has had the account for _ years, they may begin taking distributions from their Roth IRA without paying a federal income tax or a 10% penalty

Answer 23

59 1/2, 5

Question 24

An eligible employee (including the business owner) who participates in their employers _____ plan must establish their own individual _____ IRA to which the employer will deposit contributions.

Meaning once this account is set up, each individual who has a vested interest in this account must create their own IRA account for contributions

Answer 24

SEP IRA