1. What are the average ages at which men and women retire?

2. What is the approximate average annual cost of residing in an assisted-living facility or a semiprivate room in a nursing home?

3. What percentage of workers cash out of their 401(k) plans when changing jobs?
a. 22 % b. 32 % c. 42 % d. 52 %

4. What is considered a prudent rate of withdrawal when first tapping retirement savings?
a. 4 % b. 6 % c. 8 % d. 10 %

5. What percentage of retirees say their income in retirement is roughly equal to their income before
retirement?
a. 9 % b. 19 % c. 29 % d. 39 %

6. At what age do Americans qualify for full Social Security benefits?
a. 65 b. 66 c. 67 d. Varies by birth

7. What percentage of eligible Americans begin collecting reduced Social Security benefits at 62?
a. 29 % b. 39 % c. 49 % d. 59 %

8. True or false: If you begin collecting benefits from Social Security at 62, a portion of those benefits could be withheld if you have earned income.
True or False

9. What is the average monthly Social Security payment for retired workers?
a. $950 b. $1,450 c. $1,950 d. $2,450

10. What percentage of people 65 and older depend on Social Security for at least half their income?
a. 36 % b. 46 % c. 56 % d. 66 %

Answers

1. B (men) and A (women)
The exact figures, based on labor-force data for 1999 to 2004, are 61.6 for men and 60.8 for women. While those ageshave fallen significantly in the past five decades (men and women in the early 1950s stopped working at 67, on average), the percentage of adults 60plus in the labor force has been increasing in recent years. That change suggests that average retirement ages may be starting to bottom out and could begin to rise. 2. A (assisted living) and D (nursing home) When asked what source they would use to pay the blk of
long-term care costs, 31 percent of respondents in a study my MetLife Inc. listed Medicare, health insurance or disability insurance - none of which covers the cost of long-term care.

3. C
Forty-two percent of workers withdraw all the assets from their 401(k)s when changing jobs, according to Hewitt Associates. Doing so results in a huge tax bite and can seriously erode retirement security.

4. A
Research has indicated that a safe rate of withdrawal — so as not to outlive one’s nest egg — is about 4 per-cent a year. Thus, a person who has $500,000 in savings could withdraw $20,000 during the first year of retirement and increase that withdrawal each year by the amount of inflation. A recent study in the Journal of Financial Planning suggests an initial rate of as much as 6 percent could be safe — so long as investors are willing to limit withdrawals after a down year in their portfolios.

5. D
Many workers seriously underestimate how much of their pre-retirement income will be needed, according to the Employee Benefit Research Institute. Four in 10 retirees say their income needs are about equal to their pre-retirement income — but fewer than one in 10 workers think they will need that much money.

6. D
Uncle Sam is gradually increasing the age at which individuals become eligible for full Social Security benefits. For those born in 1939, full retirement age is 65 years and four months; for those born in 1940, full retirement age is 65 years and six months. Eventually, full retirement age will level off at 67 for people born in 1960 and later. That said, almost one-third of today’s workers, according to a survey by the Employee Benefit Research Institute, still believe they are eligible for full Social Security benefits at 65 — and one in five believe they qualify for full benefits before 65.

7. C
Almost half of workers grab Social Security at 62, the earliest age at which benefits are available.

8. True
Between 62 and the year in which workers reach full retirement age, Social Security benefits are reduced $1 for every $2 earned over $11,640. (That cap increases slightly each year, and the rules change in the year an individual reaches full retirement age.) After full retirement age, there is no reduction in benefits tied to earnings.

9. A
In 2005, the average monthly benefit, including a new 2.7 percent cost-of-living adjustment, will total about $950.

10. D
About two-thirds of Social Security beneficiaries 65-plus rely on their monthly check from Uncle Sam for more than half their income. For about 20 percent of Americans 65- plus, Social Security is their only income.

Berks County Senior Citizens Council, Inc.
40 North Ninth Street
Reading, PA 19601
(610) 374-3195
berkssrs@bcscc.org