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Questions and Answers
- Allowable investments within an IRA include all of the following except
A. investment company securities.
B. corporate stocks and bonds.
C. certain U.S. government-minted gold and silver coins.
D. collectibles such as postage stamps.
- Generally speaking, nonqualified retirement plans
A. are funded with after-tax dollars.
B. must have a trust agreement.
C. may not discriminate with regard to who can participate.
D. must have IRS approval.
- ERISA rules and regulations include all of the following except
A. ERISA protects participants in private-sector retirement plans, such as a pension, from the creditors of the corporation.
B. a retirement plan covered by ERISA may not discriminate against who is eligible to participate in the plan.
C. they define when employer contributions become the employee's money.
D. ERISA allows the corporation to choose the beneficiary of plan benefits for employees before their retirement.’
Study Notes
IRAs and Investments
- Investment company securities, corporate stocks and bonds, and certain U.S. government-minted gold and silver coins are allowable investments within an IRA.
- Collectibles such as postage stamps are not allowable investments within an IRA.
Non-Qualified Retirement Plans
- Non-qualified retirement plans are funded with after-tax dollars.
- These plans do not require a trust agreement.
- These plans may discriminate with regard to who can participate.
- These plans do not require IRS approval.
ERISA Rules and Regulations
- ERISA protects participants in private-sector retirement plans from the creditors of the corporation.
- ERISA prohibits discrimination against who is eligible to participate in a plan.
- ERISA defines when employer contributions become the employee's money.
- ERISA does not allow the corporation to choose the beneficiary of plan benefits for employees before their retirement.
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Description
Test your knowledge on allowable investments within an Individual Retirement Account (IRA) by identifying which investment option is not allowed.
