Certified Plan Sponsor Professional (CPSP) Practice Exam

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Prepare for the Certified Plan Sponsor Professional Exam. Use flashcards and multiple choice questions with full explanations. Achieve exam success!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

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What is a primary objective of ERISA regarding retirement plans?

To eliminate pension plans
To enhance benefits offered to employees
To protect plan participants and beneficiaries
To centralize retirement planning

The correct answer is: To protect plan participants and beneficiaries

The primary objective of the Employee Retirement Income Security Act (ERISA) is to protect plan participants and beneficiaries. ERISA was enacted in 1974 to ensure that employee benefit plans are managed and administered responsibly and transparently. This goal is achieved by establishing minimum standards for pension and health plans in the private industry, thus giving participants rights to information about their plans, establishing accountability for plan fiduciaries, and providing security for the benefits promised. The legislation covers various areas including reporting and disclosure requirements, fiduciary responsibilities, and the establishment of a claims and appeals process for participants. By focusing on the protection of plan participants and beneficiaries, ERISA helps ensure that individuals receive the benefits they are entitled to and that the plans are managed with their best interests in mind. This role is fundamental in promoting trust and integrity in retirement planning and employee benefits within the workplace.