1. Traditional IRA's give you tax benefits now while Roth IRA's give you tax benefits when you retire.

True

False

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

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 in the same year?

Yes

No

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

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

True

False

6. If you were employed in both 2017 and 2018, can you make two IRA contributions up to the limit ($5,500 each) in 2018 as long as your contribution for 2017 is made before April 15, 2018 and as long as any tax deduction for the 2017 contribution is taken on your 2017 taxes?

Yes

No

7. IRA's must always be in the name of a single individual. There is no such thing as a joint IRA account.

True

False

8. Anyone can contribute to a Roth IRA regardless of how much income they make in a given year.

True

False

9. You cannot contribute to an IRA if you have already contributed the maximum to a defined contribution retirement plan at work.

True

False

10. Imagine that you are married and file a joint tax return. You are employed but your spouse stays at home to take care of your two young children. Can your spouse contribute to an IRA using money that you earned?

Yes

No

11. Even if you have opened and contributed to a traditional or Roth IRA in the past, you can convert it (under specified conditions) into the other type of IRA. Which of these types of conversions is by far the more common:

From traditional to Roth

From Roth to traditional

12. If you expect not to spend the contents of your IRA during your lifetime and would like to leave the money to your children, you should contribute primarily to a Roth IRA rather than a traditional IRA.

True

False

13. As a general rule, it is wise to contribute to a traditional IRA if you expect to be in a higher tax bracket when you retire than you are in now and contribute to a Roth IRA if you expect to be in a lower tax bracket when you retire than you are in now.

True

False

14. Imagine that your mother is 62 years old and planning to retire at 66. If she puts $6,000 into a Roth IRA at the age of 62 and it grows to $8,000 by the time she retires at 66, can she withdraw the full $8,000 without paying any taxes?

Yes

No

15. Suppose you contributed $5,000 per year to a ROTH IRA between the ages of 25 and 30. Your total contribution was $25,000, and your account is now worth $34,000. You are now 35 years old and would like to buy a house. How much of your IRA can you withdraw to make a down payment on the house without paying any taxes or penalties on the withdrawal?

$0

$10,000

$16,000

$25,000

$34,000