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AAFM GLO_CWM_LVL_1 Exam - Topic 9 Question 98 Discussion

Actual exam question for AAFM's GLO_CWM_LVL_1 exam

Question #: 98
Topic #: 9

[All GLO_CWM_LVL_1 Questions]

Which of the following is not a characteristic of defined benefit plan?

ABenefit levels are guaranteed

BThese plans are easy to design and explain to employees

Cactuarial assumptions are necessary to determine actual contribution amounts

DEmployer is subject to a recurring annual funding obligation

Show Suggested Answer

Suggested Answer: B

by Kris at Jan 25, 2025, 03:26 PM

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Josephine

9 months ago

C makes sense, actuarial stuff is key for contributions.

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Annice

10 months ago

I thought all plans had guaranteed benefits, so A seems off.

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Arlette

10 months ago

Wait, are these plans really that complicated?

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Shayne

10 months ago

Totally agree, B is misleading!

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Rolande

10 months ago

B is definitely not a characteristic.

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Linn

11 months ago

I thought all of these options were characteristics, but I guess the ease of design might be the odd one out.

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Davida

11 months ago

I practiced a similar question where we discussed actuarial assumptions, so I'm leaning towards option B as well.

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Kirk

11 months ago

I'm not entirely sure, but I think option B might be the one that doesn't fit since these plans can be quite complex.

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Louvenia

11 months ago

I remember that defined benefit plans guarantee benefit levels, so that can't be the answer.

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Elli

11 months ago

I think the key here is to identify the one characteristic that is not typical or expected for a defined benefit plan. The fact that they are easy to design and explain to employees seems a bit out of place compared to the other options.

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Solange

11 months ago

I'm a bit confused on this one. The options seem pretty similar - they all sound like characteristics of defined benefit plans. I'll need to really focus and analyze each one carefully.

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Sherill

11 months ago

Okay, let's see. I know defined benefit plans guarantee the benefit level, so that can't be the answer. And the employer has a recurring funding obligation, so that's not it either.

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Jolanda

11 months ago

Hmm, this one seems tricky. I'll need to think through the key characteristics of defined benefit plans to figure out which one is not a typical feature.

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Johna

1 year ago

Defined benefit plan? More like 'defined headache' plan, am I right?

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Chanel

1 year ago

D) Employer is subject to a recurring annual funding obligation

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Tyisha

1 year ago

C) actuarial assumptions are necessary to determine actual contribution amounts

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Lovetta

1 year ago

A) Benefit levels are guaranteed

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Pearly

1 year ago

Option D is the one that doesn't fit. Employer funding obligation? That's the whole point of these plans!

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Muriel

1 year ago

Option C, really? Actuarial assumptions are like voodoo magic in these plans. How else would they determine the funding?

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Jillian

1 year ago

User 2

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Wilburn

1 year ago

User 1

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Derick

1 year ago

I'd say Option A is the correct answer. Guaranteed benefit levels are the hallmark of defined benefit plans.

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Teri

1 year ago

Option B? Easy to design and explain? Hah, have they ever tried to decipher the actuarial jargon in these plans?

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Diane

1 year ago

Hmm, you might be right. Defined benefit plans do require actuarial assumptions for funding calculations.

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Nicolette

1 year ago

I disagree, I believe the correct answer is C) actuarial assumptions are necessary to determine actual contribution amounts.

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Diane

1 year ago

I think the answer is B) These plans are easy to design and explain to employees.

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