How well do you know... (R04) Pensions & retirement planning?
Here is a selection of three sample questions from CII exam module R04: Pensions & retirement planning, which will be available to sit at any of 60 UK exam centres from September.
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Sample questions: (R04) Pensions & retirement planning
(scroll right down to the bottom of the page to check your answers)
1) Trevor is a member of a defined benefit company pension scheme. Which factor relating to his circumstances confirms that he will avoid incurring a special annual allowance charge in the 2010/2011 tax year?
A. He is a member of an Employer Financed Retirement Benefit Scheme (EFRBS).
B. He is aged 61.
C. His total annual earnings have never exceeded £110,000.
D. His benefits include the maximum level of death benefit.
2) Stephen is about to commence taking benefits from his personal pension scheme, which includes protected rights. He should be aware that:
A. he can take up to 25% of the total fund as a pension commencement lump sum.
B. he has the right to exercise the open market option.
C. his whole pension fund must provide limited price indexation in payment.
D. the value of the protected rights element will not count towards the lifetime allowance.
3) Frank, age 55, is considering adopting a lifestyle investment technique as he aims to build up his personal pension prior to retirement. He should be aware that:
A. the asset mix of the fund will be adjusted automatically on pre-determined dates.
B. his ongoing exposure to equities will reduce with lifestyling.
C. after 10 years, a maximum of 25% of the investments will be in bonds.
D. lifestyling is likely to be appropriate if he intends to purchase a conventional annuity with his entire fund.
Scroll down to find correct answers to the above R04 questions.
R04: 1)C.; 2)A., B.; 3)A., B., D.