Blog

Student Question of the Week: Basis in Property Transactions

By Dan Madden, CFP®

Student Question from: Katy U.Course:  Income Tax Student Question: On the adjusted basis portion in the question below – why is the $25,000 not included? Isn’t that a commission? I thought you are supposed to include the commission or other similar costs. Nick purchased an office building in Year 1 for $150,000 and sold it…

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CFP® Practice Question of the Week: Saving for a Future Purchase

By Keir

Al wants to purchase a lake house in 20 years when he retires. The house currently costs $450,000 and inflation is 4%. As his certified financial planner, Al asks for your guidance in identifying how much he should save at the beginning of each year to accomplish his goal of purchasing the house with cash…

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Student Question of the Week: Estate Planning – 3-Year Rule

By Dan Madden, CFP®

Student Question from: SteveCourse:  Estate Planning Student Question: Hello Dan, The topic of “Transfers within three years of death” has been very confusing to me. My attempts to research this further on the Internet makes it even more confusing because of either incomplete or flat out incorrect information being provided. It seems that a lot…

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CFP Board Update: Tips for Passing the CFP® Exam

By Bruce Starks, CPA, CFP®

The CFP® Exam continues to evolve from the topic-based rubric of the past. Prior exams were built from a pre-set mix of questions from Fundamentals, Risk Management, Investments, Income Tax, Retirement, and Estate Planning. The CFP® Exam now focuses on eight “Job Task Domains.” Six domains mirror the six steps in the financial planning process while Communications…

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CFP® Practice Question of the Week: Insurance

By Keir

James is planning to insure his commercial policy. In looking over two quotes and comparing some of the policy language to his own personal policies, he has become very confused regarding the different types of deductibles. He asks you, as a certified financial planner, which of the following deductibles are typically used in commercial property…

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Student Question of the Week: Estate Planning

By Dan Madden, CFP®

Student Question from: SteveCourse:  Estate Planning – Contingent versus Vested Beneficiary Student Question: Hi Dan, I am a bit confused as to why in the example “Northwestern University” and “my son” are not considered having a future “contingent” interest in the trust since they do not receive the interest until the wife, Jane Gold dies.…

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CFP® Practice Question of the Week: Must Know Tax Rules, Kiddie Tax

By Keir

Your client Beauregard has a daughter named Constance, age 16. Constance qualifies as a dependent on Beauregard’s income tax return. She has a passion for broadcasting and earned $3,000 as a part-time announcer in a local radio station this year. Beauregard transferred $100,000 into a high yield bond fund for Constance last year. The bond…

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CFP® Practice Question of the Week: Financial Planning

By Keir

Five years ago, John and Barbara, who are in their mid-50s and have one adult child out of college, experienced a sharp increase in income (ten times) within a two-year period. Their lifestyle and the complexity of their financial situation increased respectively. Their income statement’s bottom line increased and their assets/liabilities expanded as well (third…

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Student Question of the Week: Insurance

By Dan Madden, CFP®

Student Question from: Bill M.Course:  Insurance – Replacement Cost Student Question: I don’t understand Question 2. Why does the client have 97.2% of the coverage he needs? Doesn’t he have $14,000,000 in coverage? I thought he just had 77.7% of the required coverage. Where am I messing up? Peter purchased an apartment building for $15,000,000…

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