Session 12 — Roth IRA & 401(k) • True/False Quiz

1) A 401(k) is always opened by you at any brokerage with no employer involved.

2) Roth IRA contributions are made with after-tax dollars.

3) Traditional 401(k) withdrawals in retirement are generally tax-free.

4) An employer match in a 401(k) is essentially free money and is usually worth capturing first.

5) If you expect to be in a higher tax bracket later, a Traditional (pre-tax) contribution is always better.

6) You can park your emergency fund in a 401(k) for easy access if needed.

7) In a Roth IRA, your original contributions can generally be withdrawn tax- and penalty-free at any time (earnings are different rules).

8) A target-date fund automatically shifts toward more bonds as you approach the target year.

9) The “best” portfolio is always the one with the highest return over the last year.

10) Diversification means holding many funds that all track the same index.

11) Lower expense ratios help you keep more of your returns over time.

12) If a plan only offers high-fee funds, there’s nothing you can do to reduce costs.

13) Roth 401(k) and Traditional 401(k) treat contributions the same for taxes.

14) If you panic-sell in a downturn, your asset mix was probably too aggressive for your staying power.

15) Time horizon and risk tolerance help decide your stock/bond split.

16) You need to trade your 401(k) frequently to get good results.

17) An IRA is only for people employed by the government.

18) In a Roth 401(k), the employer match (if any) goes to the Roth side too.

19) Putting everything into one hot sector fund is safer than using a broad index fund.

20) International stocks can add diversification to a U.S.-only portfolio.