Practice Quiz

Financial Planner

Category - Retirement Savings and Income Planning

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There are several types of retirement plans that either contribution or defined plans. What are three-year vesting contribution and five-year vesting benefit plans referred to as for qualified plan vesting schedules?
  1. Palate Vesting
  2. Bi-year Vesting
  3. Cliff Vesting
  4. Scheduled Vesting
Explanation
Answer: C - Three-year vesting contribution and five-year vesting benefit plans are referred to cliff vesting for qualified plan vesting schedules. Cliff vesting is employer matching funds at 100 percent after three-years for contribution plans and five-years for benefit plans. For contribution plans or benefit plans that are two- to- six-year vesting are referred to as graded vesting.
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