knowledge topics
DC Pension Plan Benefits
KNOWLEDGE EXPECTED OF: Both CFP® Professionals and QAFPTM Professionals
- Identify factors that influence the pension benefit amount for a defined contribution pension plan member, such as:
- Amount of money contributed to the account
- Length of investment time horizon
- Earnings on the amount invested
- Identify that the employee retains the risk for the value of the pension benefit received from the plan.
- Estimate the projected pension benefit for a defined contribution pension plan member.
- Estimate the tax impact of receiving a pension benefit from a defined contribution pension plan.
- Explain the pension benefit options that may be available to a defined contribution pension plan member.
- Explain how each of the factors may impact the decision to commence receiving a pension benefit from a defined contribution pension plan, such as:
- Life expectancy
- Cash flow needs
- Impact on government benefits
- Tax impact
- Evaluate the factors to consider that may impact the decision to commence receiving a pension benefit from a defined contribution pension plan.
Glossary of Verbs (mouse over to see definition)
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Define
To state exactly the meaning of
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Identify
To be aware of / to recognize and correctly name / to locate an appropriate resource
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Explain
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
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Compare
To note the similarities and differences between two or more things
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Estimate
To determine an approximate value for
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Calculate
To find the value using mathematics
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Convert
To change from one form or purpose to another
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Evaluate
To reach a conclusion or make a judgement through careful study
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Interpret
To give the meaning of / to construe or understand / to translate orally
