Question

Question 2

Assume that you have a three-year-old daughter and you have come to appreciate the power of saving and investing. Can you open up and put money into a Roth IRA in your child's name so that she can benefit from many years of compounding?

Yes

No

Question 3

Imagine that you are thirty years old and hold a good job. Can you contribute up to the annual limit ($5500 in 2017) into both a traditional and Roth IRA?

Yes

No

Question 4

The age at which you can begin withdrawing IRA funds without a penalty must correspond to the age at which you start collecting Social Security.

True

False

Question 5

People who are 50 years old or older can add an additional $1,000 to their annual IRA contribution limit.

True

False

Answer 1

1) Assume that you have a three-year-old daughter and you have come to appreciate the power of saving and investing. Can you open up and put money into a Roth IRA in your child's name so that she can benefit from many years of compounding?

Solution: True

Explanation: The children usually won't owe taxes on the money when they withdraw it, no matter how much big amount is earned in the account over the years.

?

3) Imagine that you are thirty years old and hold a good job. Can you contribute up to the annual limit ($5500 in 2017) into both a traditional and Roth IRA?

Solution: True

Explanation: If a person is under 50, then cancontribute up to $5,500 in 2017 and 2018. If person age is 50 or over then may contribute $6,500

?

3) The age at which you can begin withdrawing IRA funds without a penalty must correspond to the age at which you start collecting Social Security.

Solution: False

Explanation: There is no such norm that age at which you begin withdrawing IRA funds without a penalty has to correspond to the age at which you start collecting Social Security.

4) Solution: True

Explanation: Persons who are of age 50 and over can are allowed for additional catch up contributions of $1,000, for a total contribution limit of $6,500