Bruce Starks, CPA, CFP® – Page 16

Net Present Value Calculation

Course: Fundamentals of Financial PlanningLesson 5: Using the Financial Calculator Student Question: I have a question about NPV. In the section “NPV and IRR Review Questions”, the first question references someone trying to decide if they should prepay tuition. Here is the question: Instructor Response: When I look at the answer keystrokes, it appears as…

Maximum Family Benefit

Course: Insurance PlanningLesson 10: Social Security Student Question: Does the maximum family benefit apply to a husband and wife that are both fully insured if the combined total between the two exceeds the maximum family limit? If I understand correctly, the maximum family limit only applies if there are beneficiaries within the family receiving benefits…

Artificial Intelligence—Friend or Foe?

Good to Know Artificial intelligence is either the greatest threat to our species or the greatest boon to humankind, depending on what headline you read. The author makes the cheerful assumption that AI does not become “self-aware” and eradicate humanity á la “Terminator.” Neither this article nor financial planning will matter if the author has…

Phantom Stock

Course: Investment PlanningLesson 5: Fundamental Equity Analysis Student Question: What is the difference between Stock options and Restricted stock plan or phantom stock? Seems confusing. Instructor Response:

CFP Board Urges Senate to Pass Bill to Protect Seniors

CFP® Certificants in the News You may be encouraged to know that the U.S. House of Representatives, regardless of their political party, can still rally behind a noble cause. The Financial Exploitation Prevention Act passed the House with a bipartisan vote of 419 to 0 and now awaits action by the Senate. How exactly would…

Unused Premium

Course: Insurance PlanningLesson 8: Gift and Estate Valuation Student Question: Could you please clarify for me what the unused premium would be in term life insurance? I don’t quite understand how you could not use the premium. Thanks. Instructor Response: Certainly. A lot of different terms in insurance, to be sure. Assume you pay $6,000…

Calculating Late Filing/Paying Penalties

Course: Income Tax PlanningLesson 1: Introduction to Taxation Student Question: For this question, could you send me the math behind finding the answer? I want a better understanding of how the penalty was assessed. Review Exercise: Jerry’s taxes were due April 15th. He filed his return in October of the same year, and paid his…

Executive Compensation—Restricted Stock

Good to Know All that glitters is not gold. -French Monk Alain de Lille, 1175 Assume your client just received a grant of Restricted Stock from their employer. Congratulations are in order, but before they go out and use some of that grant “money” to celebrate, let’s understand exactly what they received and when they…

Real Estate Income and IRA Contributions

Course: Retirement PlanningLesson 1: Using IRAs to Build and Distribute More Retirement Income Student Question: This page states that rental income is not included in the definition of earned income. If the client is a professional real estate developer whose income is derived mainly from rental income, would they be able to contribute to an…

Premium Payments on Buy-Sell Agreements

Course: Insurance PlanningLesson 17: Business Uses of Life and Disability Insurance Student Question: I have a quick question regarding buy/sell agreement; not clear who would pay the premiums on disability and or life insurance on the principals and the key employees? Instructor Response: Great question. A buy-sell agreement relates to owners of the business while…