Saving for Retirement: What Do You Know?

Robert is in his early 50s. He has been employed by the same construction company for 25 years. He signed up for his company's 401(k) retirement plan soon after he joined the company and has invested 15 percent of each paycheck since then. His company also contributed "matching funds." Robert's contributions and those matching funds have been growing. Combining his 401(k) and the Social Security benefits he expects, based on his age at retirement, Robert assumed he would have enough money to retire comfortably at age 66. But, what if Robert's future 401(k) earnings don't keep up the same pace as they have in the past? Or, what if these earnings drop? Robert may have to account for these possibilities in his saving plan.

5. As he thinks about retiring, Robert's financial decisions should be based, in part, on how long he might live. How long might he live beyond his retirement age?
   
   

   a. About 10 more years
   b. About 17 more years
   c. More than 30 years

6. A 401(k) is:
   
   

   a. A retirement plan offered by the Federal Government
   b. A retirement-saving plan offered by a company to its employees
   c. A type of insurance plan

7. Robert signed up for his company's 401(k) retirement plan and started saving as soon as he joined the company. Did this decision help Robert save for his retirement?
   
   

   Yes/No

8. Will Robert pay less in current taxes because he invests in the 401(k) plan at work?
   
   Yes/No

9. There are still things Robert can do if his retirement savings decline.
   
   

   True/False