A Baby Boomer Retirement Quiz You Can’t Afford To Fail

financial planning for baby boomers-1165966295
Barry Chin / The Boston Globe via Getty Images
Barry Chin / The Boston Globe via Getty Images

The US Federal Reserve says 17% of people aged 45 to 59 have no money in retirement and only 13% aged 60 and over have money put aside. Admittedly, preparing for retirement can be a daunting task, especially when we consider that there’s more to preparing for retirement than just counting our dollars and cents.

Take this retirement quiz aimed at people close to retirement and see if you understand some of the most important facts about retirement that will help motivate you to start saving.

What is the perfect time to convert part of your traditional IRA into a Roth IRA?

Retirement-Quiz-838281888
Retry Correct Incorrect Converting your traditional IRA to a Roth IRA will minimize your tax bill in this situation, a fact almost 50% of Americans were unaware of when asked.
Jeffrey Greenberg / Universal Images Group via Getty Images
Jeffrey Greenberg / Universal Images Group via Getty Images

What is the perfect time to convert part of your traditional IRA into a Roth IRA?

  • You should never convert only part of your IRA
  • When your marginal tax rate is higher than normal
  • When your marginal tax rate is lower than normal
  • You should never convert a traditional IRA to a Roth IRA
0%

What age must you begin accepting IRA distributions to avoid a tax penalty?

Retirement-Steps-Quiz-1207568706
Retry Correct Incorrect To avoid IRS penalties you must begin taking a minimum distribution from your retirement accounts annually starting when you turn 70½.
Eva Marie Uzcategui / AFP via Getty Images
Eva Marie Uzcategui / AFP via Getty Images

What age must you begin accepting IRA distributions to avoid a tax penalty?

  • 69.5
  • 65
  • 70.5
  • 70
5%

Which Statement Is True About Roth IRA Distributions?

Roth IRA Distributions
Retry Correct Incorrect Roth IRA contributions are post-tax. You pay taxes on your income today, not in the future. This only applies if you maintain the account for at least five years.
Jeenah Moon / Getty Images
Jeenah Moon / Getty Images

Which Statement Is True About Roth IRA Distributions?

  • A Roth IRA maintained for more than five years will provide tax-free distributions
  • You can’t withdrawal Roth IRA contributions before 70.5 years old
  • Roth IRA distributions must be taken with equal payments
  • Roth IRA distributions incur a 2% transaction fee
10%

Do you know which long-term bonds usually have the highest yield?

Bonds with higher yields
Retry Correct Incorrect B-rated bonds are more speculative in nature and therefore yield a higher risk to investors. The increase in risk also means a typically higher yield.
Education Images / Universal Images Group via Getty Images
Education Images / Universal Images Group via Getty Images

Do you know which long-term bonds usually have the highest yield?

  • AAA-rated corporate bonds
  • None Of The Above
  • B-rated corporate bonds
  • Treasury Bonds
15%

Waiting To Collect Social Security Until This Age Is Recommended

Retirement Home Friends-632000444
Retry Correct Incorrect Your social security benefits rise by approximately 8 percent for every year after your full retirement age with a cap reached at 70-years-old.
Amanda Voisard / For the Washington Post
Amanda Voisard / For the Washington Post

Waiting To Collect Social Security Until This Age Is Recommended

  • 69
  • 70
  • 75
  • 76.5
20%

Which Retirement Plan Is Taxed During Distribution

401K and taxes-98452319
Retry Correct Incorrect We don’t pay taxes on 401(k) accounts at the time of deposit. When distributions are paid during retirement we pay taxes on all withdrawals.
Joe Raedle / Getty Images
Joe Raedle / Getty Images

Which Retirement Plan Is Taxed During Distribution

  • Roth IRA
  • Rollovers To Another Plan
  • 401(K)
  • Social Security Payments
25%

Is Your 401(K) At Risk If Your Employer Files For Bankruptcy?

401k risks and employer bankruptcy-3383491
Retry Correct Incorrect While your pension may be in jeopardy during a company bankruptcy, a 401(k) is a personal investment that can’t be touched by your company creditors.
Monika Graff / Getty Images
Monika Graff / Getty Images

Is Your 401(K) At Risk If Your Employer Files For Bankruptcy?

  • Yes
  • It depends on the type of bankruptcy the company files
  • No
  • It depends if your company contributes to your 401(k)
30%

The Best Way To Protect Yourself Against Inflation Is?

Retirement-Planning-665420844
Retry Correct Incorrect Diversifying your stock portfolio is an industry-leading way to protect your assets. You should spread out your investments over different industries and classes such as stocks and bonds.
Jeff Greenberg / Universal Images Group via Getty Images
Jeff Greenberg / Universal Images Group via Getty Images

The Best Way To Protect Yourself Against Inflation Is?

  • A diversified bond portfolio
  • A diversified stock portfolio
  • A savings account at your bank
  • Investing heavily in government-issued bonds
35%

How old will a 65-year-old retired man live to be?

Men Need To Prepare For This Age In Retirement-1165966275
Retry Correct Incorrect Many Americans don’t realize they could live for three decades after retirement. Under-preparing for retirement is a major issue during retirement planning.
Barry Chin / The Boston Globe via Getty Images
Barry Chin / The Boston Globe via Getty Images

How old will a 65-year-old retired man live to be?

  • 50% chance of living until 87 and 25% chance of living until 93
  • 25% chance of living until 87 and 10% chance of living until 93
  • 35% chance of living until 87 and 15% chance of living until 93
  • 27% chance of living until 87 and 10% chance of living until 93
40%

How old will 65-year-old retired women live to be?

Age Of Women In Retirement-884186074
Retry Correct Incorrect Women also underestimate the chance they will live at least 30 years past their retirement age. Women tend to live longer than men which can cause additional retirement strain.
Alyssa Schukar for The Washington Post via Getty Images
Alyssa Schukar for The Washington Post via Getty Images

How old will 65-year-old retired women live to be?

  • A 50% chance of living to 89 and 15% chance to reach 96
  • A 50% chance of living to 90 and 10% chance to reach 96
  • A 50% chance of living to 90 and 25% chance to reach 96
  • 50% chance of living until 87 and 25% chance of living until 95
45%

What Is The 4% Rule?

Money Rules for Retirement-1207749887
Retry Correct Incorrect While not a universal condition, the 4% rule suggests you can withdraw 4% of your retirement fund each year to ensure you don’t run out of money.
Xinhua / Liu Jie via Getty Images
Xinhua / Liu Jie via Getty Images

What Is The 4% Rule?

  • Invest at least 4% of your income from 18-years-old through retirement
  • You can withdrawal 4% of your retirement funds annually without running out of money
  • No more 4% of your retirement funds should be lost to broker fees
  • No more than 4% of your investments should be in any single company.
50%

What Are Your Chances Of Needing Expensive Long-Term Care?

Long Term Nursing Home Care after Retirement
Retry Correct Incorrect According to the U.S. Department of Health and Human Services, there is a 70% chance that you’ll need long-term care. A costly expense many people don’t account for when saving.
Jerry Holt / Star Tribune via Getty Images
Jerry Holt / Star Tribune via Getty Images

What Are Your Chances Of Needing Expensive Long-Term Care?

  • 70%
  • 50%
  • 60%
  • 75%
55%

What Is The Current Average Cost Of An Assisted-Living Facility?

Retirement and assisted living-1084719142
Retry Correct Incorrect The average cost of assisted living in the United States is $4051 according to a 2019 study from Genworth. That number is expected to reach over $5600 by 2030.
Jeffrey Greenberg / Universal Images Group via Getty Images
Jeffrey Greenberg / Universal Images Group via Getty Images

What Is The Current Average Cost Of An Assisted-Living Facility?

  • Approximately $4500 per month
  • Approximately $3500 per month
  • Approximately $3000 per month
  • Approximately $4000 per month
60%

What Is The Common Percent Of Your Annual Income You Should Aim To Replace In Retirement?

financial planning for baby boomers-1165966295
Retry Correct Incorrect Wells Fargo says retirees need to replace 80% of annual pre-retirement income. This includes money you receive from retirement fund distributions, social security, and other investments and part-time work.
Barry Chin / The Boston Globe via Getty Images
Barry Chin / The Boston Globe via Getty Images

What Is The Common Percent Of Your Annual Income You Should Aim To Replace In Retirement?

  • 85%
  • 70%
  • 80%
  • 60%
65%

What Percentage Of Americans Continue Working Past 65-Years-Old?

Senior Employee and Retirement Quiz
Retry Correct Incorrect Many Americans plan to work past 65-years-old in order to build a healthier retirement package. The U.S. Bureau of Labor Statistics, however, says only 1-in-5 Americans actually work after 65-years-old.
Jeffrey Greenberg / Universal Images Group via Getty Images
Jeffrey Greenberg / Universal Images Group via Getty Images

What Percentage Of Americans Continue Working Past 65-Years-Old?

  • 20%
  • 35%
  • 25%
  • 30%
70%

What’s The Youngest Age You Can Start Taking Social Security?

Retirement age and social security payments-52636396
Retry Correct Incorrect You can begin receiving social security at 62-years-old. However, you only receive 74.2% of your contributions since you’re expected to receive 50 months of additional payments based on life expectancy.
Monika Graff / Getty Images
Monika Graff / Getty Images

What’s The Youngest Age You Can Start Taking Social Security?

  • 60
  • 62
  • 69.5
  • 65
75%

How Much Can A Healthy Couple Expect To Spend On Healthcare in Retirement?

Retirement and Healthcare costs-672838239
Retry Correct Incorrect Fidelity Investments projected in 2019 that a healthy couple will spend, on average, at least $275,000 on healthcare during retirement. Healthcare costs are often overlooked when planning for retirement.
Camerique / ClassicStock / Getty Images
Camerique / ClassicStock / Getty Images

How Much Can A Healthy Couple Expect To Spend On Healthcare in Retirement?

  • $200,000
  • $300,000
  • $250,000
  • $275,000
80%

What Is The Median 401(k) Balance For People Aged 60-69

Retiring and Money in your account-1207934741
Retry Correct Incorrect According to Fidelity, the average median income held in a 401(k) for people aged 60-69 is just $82,000.
Chandan Khanna / AFP via Getty Images
Chandan Khanna / AFP via Getty Images

What Is The Median 401(k) Balance For People Aged 60-69

  • $72,000
  • $82,000
  • $92,000
  • $62,000
85%

Will You Get Two Social Security Checks When Your Spouse Dies

Social Security-625446404
Retry Correct Incorrect When one spouse dies the survivor receives the larger of the two checks. This is why it’s important for the higher earner to wait as long as possible before filing.
John McDonnell / The Washington Post via Getty Images
John McDonnell / The Washington Post via Getty Images

Will You Get Two Social Security Checks When Your Spouse Dies

  • No. You will get your check and a single death benefits payment.
  • No. You are only entitled to your own social security benefits
  • No. You will get the larger of your two checks
  • Yes. But you only get 50% of your spouses check
90%

Which Statement Is True About A Mutual Fund

Retirement Planning and Mutual Funds
Retry Correct Incorrect Mutual funds are made up of pools of funds that are created with help from many investors.
Jeffrey Greenberg / Universal Images Group via Getty Images
Jeffrey Greenberg / Universal Images Group via Getty Images

Which Statement Is True About A Mutual Fund

  • A mutual fund does not include any fees. The mutual fund holder only earns money if you earn money.
  • Mutual funds are only available through plans set up by your employer
  • A mutual fund is made up of a pool of funds that is collected from many investors
  • Mutual funds are limited to only 20 different financial securities per portfolio
95%

Congrats, you finished! Here are your results:

Congrats, you finished! Here are your results:

Retry Please Check With A Retirement Consultant Based on your answers, we highly recommend you consult with a retirement specialist who can help set you on the right path. Remember, even if you’re in your 50s you can still accelerate your retirement savings. Solid Start But You Should Consult A Specialist It seems like you have a grasp on some very basic retirement steps but consulting with a financial advisor is highly recommended so you can set yourself up for a happy and less stressful retirement. You’re Almost There Based on your answers we assume you probably have thought about your retirement and you might even be investing in your future. Keep researching all options available to you and consult with a financial planner. You’re On The Right Track! If we had to guess, you’ve thought about your retirement, you’ve probably even saved some money and diversified your portfolio. Even if you’re a seasoned pro, stay in contact with a financial planner to ensure you’re always on-track for your retirement needs and goals.
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