CWS Retirement Planning Flashcards
6 cards from real CWS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 CWS Retirement Planning flashcards as text
A Roth IRA conversion is generally most advantageous when a client is in which situation?
Answer: Currently in a low tax bracket expecting higher rates in retirement
Converting to a Roth IRA is most beneficial when current tax rates are lower than anticipated future rates, reducing total lifetime tax burden.
Which retirement account allows contributions regardless of income level with no RMD requirements during the owner's lifetime?
Answer: Roth IRA
Roth IRAs have no RMD requirements for the original owner and allow contributions regardless of income (subject to phase-out limits).
What is the primary purpose of a 72(t) distribution election (SEPP)?
Answer: To take penalty-free IRA withdrawals before age 59½ through substantially equal periodic payments
A 72(t) SEPP plan allows penalty-free IRA withdrawals before age 59½ by committing to a series of substantially equal periodic payments.
A client has a traditional pension with a lump-sum option and an annuity option. Which factor most strongly favors choosing the annuity option?
Answer: Long life expectancy and concern about outliving assets
The annuity option provides guaranteed income for life and is most advantageous for clients with longevity risk who need predictable income.
What is the maximum annual benefit limit for a defined benefit plan in 2024?
Answer: $265,000
The 2024 IRS annual benefit limit for defined benefit plans is $265,000, as adjusted periodically for cost-of-living.
Which Medicare part covers inpatient hospital stays and skilled nursing facility care?
Answer: Medicare Part A
Medicare Part A covers inpatient hospital care, skilled nursing facility stays, hospice, and some home health services.