Reading 19: Life-Cycle Investing －LOS d~Q1-3 only, income, assets, returns, individual

mayanfang1

Q1. Relative to a drawdown plan that is based upon an individual’s life expectancy, if an individual only spends the real returns on their financial assets, their income will be:

A)   larger, and the remaining estate will also be larger.

B)   larger, but the remaining estate will be smaller.

C)   smaller, but the remaining estate will be larger.

Q2. Once an individual reaches the retirement stage of life, the main concern is:

A)   safety of principal, with investment income being secondary.

B)   reallocating financial assets to adopt a more conservative profile.

C)   establishing a drawdown rate that will not result in their outliving their assets.

Q3. A financial asset that is specifically designed to address the problem of outliving one’s assets is called:

A)   a guaranteed investment contract.

B)   a life annuity.

C)   life insurance.

 

luqian55

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deqiang

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maxsimax

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思霖

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aleckkwong

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