Investment vehicle selection and retirement account rules and distribution concepts tested on the CFP exam.
44 cards · basic cards · AI-written, checked twice. Edit anything.
- What is a stock?
- An ownership share in a corporation that may provide dividends and capital appreciation.
- What is a bond?
- A debt security representing a loan to a corporation or government, typically paying fixed interest.
- What is a mutual fund?
- An investment fund that pools money from many investors to purchase a diversified portfolio of securities.
- What is an ETF?
- Exchange-traded fund, a fund that trades on an exchange like a stock but holds a basket of underlying securities.
- What is a REIT?
- Real Estate Investment Trust, a security that allows investors to own shares in real estate holdings or mortgages.
- What is the 2026 Traditional IRA contribution limit for those under age 50?
- $7,000
- What is the 2026 Roth IRA contribution limit for those under age 50?
- $7,000
- How do contributions to a Traditional IRA differ from contributions to a Roth IRA?
- Traditional IRA contributions may be tax-deductible; Roth IRA contributions are not deductible.
- How do distributions from a Traditional IRA differ from distributions from a Roth IRA?
- Traditional IRA distributions are generally taxable as ordinary income; qualified Roth distributions are tax-free.
- Who may establish a SEP IRA?
- Self-employed individuals and business owners with employees.
- What is the 2026 SEP IRA contribution limit?
- Up to 25% of net self-employment income or $70,000, whichever is less.
- Who may establish a SIMPLE IRA?
- Employers with 100 or fewer employees.
- What is the 2026 SIMPLE IRA contribution limit?
- $16,500 for employees under age 50.
- Who may establish a Solo 401(k)?
- Self-employed individuals with no employees other than a spouse.
- What is a Traditional 401(k)?
- An employer-sponsored retirement plan allowing employees to make pre-tax contributions with potential employer matching.