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Business Uses of Life and Disability Insurance
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…
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Transfer of Interest in Property Held in Joint Tenancy
Gary Chapelle owns a duplex with his brother in joint tenancy with right of survivorship. Gary would like to pass his interest in the property to his son, Bill, and Gary has provided in his will that his interest in the duplex will pass to Bill. Which of the following statements concerning the transfer of…
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Vanguard Becomes Newest Founding Sponsor of Center for Financial Planning
CFP® Board Updates The CFP Board has announced Vanguard as the newest Founding Sponsor of CFP Board Center for Financial Planning. Having worked with the CFP Board for the past 6 years, Vanguard has been an invaluable support for the goals of the Center. Corporate sponsors like Vanguard form the backbone of opportunities provided by…
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Solving for Annual Equivalent Rate
Course: Fundamentals of Financial PlanningLesson 5: Using the Calculator Student Question: I am confused as to how to get the correct answer for number 4. Jackie invests her bonus at the beginning of this calendar year. If she earns 7% compounded monthly, what is the annual equivalent rate? Round your answer to two decimal places.…
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Selecting an Appropriate Trust
Which of the following trusts should Jason establish in his Will to provide for his son Gaven’s living expenses until Gaven reaches age 65 if Gaven is currently a 30-year old unemployed aspiring actor? 2503(b) trust 2503(c) trust Crummey trust Totten trust CLICK TO REVEAL ANSWER Expand A is the answer. The 2503(b) trust would…
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What Can A Children’s Story Teach Us About Retirement Savings?
Good to Know A financial planner’s or advisor’s role can be as much about implementation as it is about inspiration. The best retirement savings plan in the history of humankind may be doomed to failure when a client is disengaged or procrastinates. Sadly, too many of our clients understand the importance of putting the plan…
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Percentage of Completion Method
Course: Income Tax PlanningLesson 10: Recognition of Expenses, Losses, and Deductions Student Question: Question 5 (below) did not make sense to me. I started out by breaking down by year — 400,000/2,100,000*3,000,000 and so forth, but did not arrive at the correct answer. So then I tried adding up 3 year — 400+650+700/2100000*3,000,000. That wasn’t…
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Who is an Investment Advisor?
Which of the following individuals need to register with the SEC under the Investment Advisers Act of 1940? Adam who retired last year from a big brokerage house but he recently started providing services to 12 clients who live in his neighborhood that he met while out golfing. Belinda who writes weekly investment articles for…
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Trailing Commissions and Sales-Related Compensation
CFP® Certificants in the News True or false, a CFP® professional who receives trailing commissions cannot represent their practice as “fee-only” under any circumstance. The answer may surprise you. Read on to see why. CFP Board “Standard A.12 of the Code of Ethics and Standards of Conduct provides that a CFP® professional may not make false or misleading representations…
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