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# One retirement account option allows a worker to save money

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One retirement account option allows a worker to save money [#permalink]  18 Jul 2018, 09:20
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Question Stats:

65% (01:23) correct 35% (01:41) wrong based on 40 sessions
One retirement account option allows a worker to save money without paying taxes, but requires the worker to pay taxes on funds withdrawn from the account upon retirement. A second option requires the worker to pay taxes upfront, but allows the worker to withdraw funds tax-free upon retirement. Assuming that the total amount available in the worker’s retirement account at retirement is higher than the total amount contributed prior to retirement, workers can expect to pay less in taxes overall if they choose the second option.

Which of the following pieces of information would be most useful in determining whether the conclusion is valid for an individual worker?

(A) The amount of money the worker will contribute to the retirement plan over his or her career
(B) The amount that tax rates will increase in the future
(C) Whether inflation will be lower than the retirement account’s annual earnings
(D) How the worker’s tax bracket in retirement compares to his or her tax bracket while still employed
(E) The dollar value of the worker’s account upon retirement

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[Reveal] Spoiler: OA

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Re: One retirement account option allows a worker to save money [#permalink]  19 Jan 2019, 20:23
Re: One retirement account option allows a worker to save money   [#permalink] 19 Jan 2019, 20:23
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