Podcast
Questions and Answers
What is the main purpose of a pension?
What is the main purpose of a pension?
- To provide tax deductions during working life
- To provide a lump sum on retirement and an annual pension thereafter (correct)
- To encourage people to buy homes
- To invest in government bonds
Which statement best describes the tax efficiency of pension contributions?
Which statement best describes the tax efficiency of pension contributions?
- They increase taxable income
- They have no effect on income tax paid
- They are subject to double taxation
- They decrease taxable income and amount of income tax paid (correct)
Why do governments provide tax advantages for pension contributions?
Why do governments provide tax advantages for pension contributions?
- To discourage people from saving for retirement
- To increase the government's current year income
- To encourage people to provide for their old age (correct)
- To avoid funding issues for governments
What is a common issue with state pensions according to the text?
What is a common issue with state pensions according to the text?
How are state pensions funded in many countries?
How are state pensions funded in many countries?
Which of the following is NOT mentioned as a type of retirement fund in the text?
Which of the following is NOT mentioned as a type of retirement fund in the text?
What is the forecasted dependency ratio in the UK by 2050?
What is the forecasted dependency ratio in the UK by 2050?
Which type of pension scheme is known for providing an employee with a pension related to their final salary based on years of service?
Which type of pension scheme is known for providing an employee with a pension related to their final salary based on years of service?
Why have many companies shifted from offering Final Salary schemes to Defined Contribution schemes for new employees?
Why have many companies shifted from offering Final Salary schemes to Defined Contribution schemes for new employees?
What is a key advantage for employers of Defined Contribution (DC) schemes over Defined Benefit (DB) schemes?
What is a key advantage for employers of Defined Contribution (DC) schemes over Defined Benefit (DB) schemes?
What are Personal Pensions also known as?
What are Personal Pensions also known as?
Who typically organizes personal pension schemes for employees?
Who typically organizes personal pension schemes for employees?
What is a distinguishing feature of a non-contributory pension scheme?
What is a distinguishing feature of a non-contributory pension scheme?
Why do many private sector employers no longer provide Final Salary schemes to new employees?
Why do many private sector employers no longer provide Final Salary schemes to new employees?
What is one of the advantages of occupational pension schemes over personal pensions?
What is one of the advantages of occupational pension schemes over personal pensions?
In what way do Defined Contribution (DC) schemes differ from Defined Benefit (DB) schemes regarding pension payouts?
In what way do Defined Contribution (DC) schemes differ from Defined Benefit (DB) schemes regarding pension payouts?
What is the key responsibility that lies with the individual in a private scheme?
What is the key responsibility that lies with the individual in a private scheme?
Which country are Individual Retirement Accounts (IRAs) primarily found in?
Which country are Individual Retirement Accounts (IRAs) primarily found in?
What determines if contributions to a traditional IRA are tax-deductible?
What determines if contributions to a traditional IRA are tax-deductible?
What is the consequence of having an unauthorised overdraft?
What is the consequence of having an unauthorised overdraft?
How are retailers paid when customers use credit cards for purchases?
How are retailers paid when customers use credit cards for purchases?
What can customers choose to do when they receive a monthly credit card statement?
What can customers choose to do when they receive a monthly credit card statement?
What is a characteristic of unsecured loans?
What is a characteristic of unsecured loans?
What is often offered by credit card companies to attract new customers?
What is often offered by credit card companies to attract new customers?
What should borrowers try to avoid when it comes to overdrafts?
What should borrowers try to avoid when it comes to overdrafts?
How do traditional IRAs differ from Roth IRAs?
How do traditional IRAs differ from Roth IRAs?
What formula is used to calculate the effective annual rate (EAR)?
What formula is used to calculate the effective annual rate (EAR)?
What factor is added to the quoted rate when calculating the EAR?
What factor is added to the quoted rate when calculating the EAR?
In the UK, what does APR stand for in relation to borrowing costs?
In the UK, what does APR stand for in relation to borrowing costs?
What is a mortgage typically provided for?
What is a mortgage typically provided for?
What term describes property bought with the intention to be let out to tenants?
What term describes property bought with the intention to be let out to tenants?
What type of mortgage involves only paying interest without reducing the principal balance?
What type of mortgage involves only paying interest without reducing the principal balance?
What should be considered about capital gains related to a principal private residence?
What should be considered about capital gains related to a principal private residence?
What could be an additional cost associated with purchasing a property?
What could be an additional cost associated with purchasing a property?
What is the potential perception about property investments compared to other investments?
What is the potential perception about property investments compared to other investments?
'Buy-to-let' mortgages are commonly used for which purpose?
'Buy-to-let' mortgages are commonly used for which purpose?
What is the main difference between unsecured loans and mortgages?
What is the main difference between unsecured loans and mortgages?
If a borrower defaults on an unsecured loan, what is the typical action taken by the lender?
If a borrower defaults on an unsecured loan, what is the typical action taken by the lender?
In the context of borrowing costs, why are mortgages considered cheaper compared to credit cards?
In the context of borrowing costs, why are mortgages considered cheaper compared to credit cards?
What happens if a borrower with an unauthorised overdraft does not inform the bank of spending excesses?
What happens if a borrower with an unauthorised overdraft does not inform the bank of spending excesses?
How are flat rates quoted by loan companies different from the effective annual rate (EAR)?
How are flat rates quoted by loan companies different from the effective annual rate (EAR)?
What is the typical course of action for a lender if a secured loan is not repaid by the borrower?
What is the typical course of action for a lender if a secured loan is not repaid by the borrower?
Why do lenders prefer issuing secured loans for property purchases rather than unsecured loans?
Why do lenders prefer issuing secured loans for property purchases rather than unsecured loans?
What is one advantage of having a mortgage over an unsecured loan in terms of non-repayment consequences?
What is one advantage of having a mortgage over an unsecured loan in terms of non-repayment consequences?
What is a key differentiator between Islamic banks and conventional banks according to the text?
What is a key differentiator between Islamic banks and conventional banks according to the text?
What is a fundamental requirement for a contract to be considered valid under Islamic law?
What is a fundamental requirement for a contract to be considered valid under Islamic law?
In Islamic finance, what plays a crucial role in ensuring the ethical conduct of financial activities?
In Islamic finance, what plays a crucial role in ensuring the ethical conduct of financial activities?
What is the primary function of the Shariah Supervisory Committee (SSC) in Islamic banking practices?
What is the primary function of the Shariah Supervisory Committee (SSC) in Islamic banking practices?
What is the key feature of a Murabaha transaction in Islamic finance?
What is the key feature of a Murabaha transaction in Islamic finance?
How does Islamic banking differ from conventional banking regarding funding sources?
How does Islamic banking differ from conventional banking regarding funding sources?
What is the main objective behind Islamic banking principles according to the text?
What is the main objective behind Islamic banking principles according to the text?
How does an Ijara transaction differ from a conventional mortgage?
How does an Ijara transaction differ from a conventional mortgage?
What is the main reason why Islamic banks are prohibited from investing in certain businesses?
What is the main reason why Islamic banks are prohibited from investing in certain businesses?
How do home purchase plans offered by Islamic banks differ from conventional mortgage arrangements?
How do home purchase plans offered by Islamic banks differ from conventional mortgage arrangements?
What is the key advantage of a repayment mortgage over other forms of mortgage?
What is the key advantage of a repayment mortgage over other forms of mortgage?
What does an interest-only mortgage require the borrower to do?
What does an interest-only mortgage require the borrower to do?
What is one of the main risks attached to an interest-only mortgage?
What is one of the main risks attached to an interest-only mortgage?
In a repayment mortgage, when do payments become predominantly capital?
In a repayment mortgage, when do payments become predominantly capital?
What does a lender consider when assessing applicants for a loan?
What does a lender consider when assessing applicants for a loan?
What is referred to as the loan-to-value ratio in mortgage applications?
What is referred to as the loan-to-value ratio in mortgage applications?
When does the capital begin to reduce significantly in a repayment mortgage?
When does the capital begin to reduce significantly in a repayment mortgage?
What happens if a borrower fails to meet repayments in an interest-only mortgage?
What happens if a borrower fails to meet repayments in an interest-only mortgage?
In an offset mortgage, how are savings utilized for interest calculation?
In an offset mortgage, how are savings utilized for interest calculation?
What is the primary benefit of an offset mortgage?
What is the primary benefit of an offset mortgage?
In a variable rate mortgage, how does the interest change?
In a variable rate mortgage, how does the interest change?
What is the key advantage of a fixed rate mortgage?
What is the key advantage of a fixed rate mortgage?
How do capped rate mortgages protect borrowers?
How do capped rate mortgages protect borrowers?
What is a common feature of discounted rate mortgages?
What is a common feature of discounted rate mortgages?
What is the primary reason charging or receiving interest is prohibited in Islamic finance?
What is the primary reason charging or receiving interest is prohibited in Islamic finance?
'Risk-sharing' is emphasized in Islamic finance to avoid:
'Risk-sharing' is emphasized in Islamic finance to avoid:
'Capped rate' mortgages are designed to protect borrowers from:
'Capped rate' mortgages are designed to protect borrowers from:
'Lock-in' periods are commonly associated with which type of mortgage?
'Lock-in' periods are commonly associated with which type of mortgage?
What is the main event insured in a life policy?
What is the main event insured in a life policy?
What does a lump sum payment in a life policy depend on besides the date of death?
What does a lump sum payment in a life policy depend on besides the date of death?
What is the main difference between whole-of-life assurance and term assurance?
What is the main difference between whole-of-life assurance and term assurance?
What does a term assurance policy provide coverage for?
What does a term assurance policy provide coverage for?
In life policies, what determines the total payout to beneficiaries?
In life policies, what determines the total payout to beneficiaries?
What is the primary purpose of an investment-based life policy?
What is the primary purpose of an investment-based life policy?
What is the main purpose of a whole-of-life policy compared to a term assurance policy?
What is the main purpose of a whole-of-life policy compared to a term assurance policy?
Which type of whole-of-life policy pays a guaranteed amount plus any profits made between policy inception and death?
Which type of whole-of-life policy pays a guaranteed amount plus any profits made between policy inception and death?
What happens if an individual with term assurance is diagnosed with a terminal illness expected to result in death within 12 months?
What happens if an individual with term assurance is diagnosed with a terminal illness expected to result in death within 12 months?
What is the primary reason for purchasing a whole-of-life policy as part of protection planning exercise?
What is the primary reason for purchasing a whole-of-life policy as part of protection planning exercise?
In term assurance, how does the selected amount and cover period impact the policy?
In term assurance, how does the selected amount and cover period impact the policy?
What distinguishes unit-linked whole-of-life policies from other types of whole-of-life policies?
What distinguishes unit-linked whole-of-life policies from other types of whole-of-life policies?
