Blog
Retirement Plan Required Minimum Distributions
Course: Retirement PlanningLesson 5: Leveraging Nonqualified Plans for Small Business and Not-For-Profit Employees and Owners Student Question: Hi TI’m trying to distinguish when the required minimum distribution amounts are at 72 years old, versus when they are 70 ½. IRA’s are now 72, correct? Is a 401k plan and a 403b 70 1/2? Thank you…
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Retirement Funding Calculation
Erika wants $50,000 a year in today’s dollars in retirement. She anticipates retiring in 10 years and living in retirement for 30 years. Erika can earn 7% on her investments and she expects inflation to average 4%. Approximately how much should Erika have saved by the day she retires to meet this goal? $913,000 $983,000…
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CFP Board Discipline—Learning from Others’ Mistakes
CFP® Certificants in the News This blog will emphasize recent CFP Board disciplinary trends and the avoidable mistakes made by certificants and candidates1 that can lead to unnecessarily severe discipline. Data for this blog is taken from a CFP Board News Release dated June 30, 2021, in which forty disciplinary actions were published. The topics…
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Equitable Distributions
Course: Income Tax PlanningLesson 15: Property Transactions Student Question: Hi This page explains how the basis for inherited property is affected for common-law states and community property states. How is it affected for equitable distribution states like Florida? Thank you Anibal Instructor Response: Great question Anibal! Only marital property is subject to equitable distribution in…
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Calculating Gross Income from Various Sources
A client received an annual salary from his employment of $30,000. He was a 50% owner of both a C corporation and an S corporation. The C corporation had net profits of $24,000, and the S corporation had income of $17,000. Neither corporation made a distribution. The client’s revocable trust had income of $15,000 but…
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Understanding the Investment Loan Interest Deduction
Good to Know Can you deduct the interest you pay on loans used to make investments? Conventional wisdom would have you believe the rules are complex. Yet, we only need to address the following three questions to gain clarity. What kinds of interest paid on investment loans are deductible? How do dividend income and capital…
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Plan Monitoring and Updating Responsibility
Course: Fundamentals of Financial PlanningLesson 9: CFP Board Regulatory Requirements Student Question: Hi In lesson 1, for step 7, I have that a certificant is responsible for monitoring and updating only if explicitly called for in the scope of the engagement. In Lesson 9, I’m reading that the certificant is responsible unless explicitly excluded. Which…
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Calculating Realized Compound Yield on a Bond
An investor bought a bond at par that matures in 15 years. The bond pays an annual coupon of $130 and the reinvestment rate is 9%. What is the realized compound yield of this bond? 11.05% 12.55% 13.00% 14.10% CLICK TO REVEAL ANSWER Expand A is the answer. One would anticipate a realized compound yield…
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Changes to CFP Board Principal Knowledge Topics
CFP® Board Updates Earlier this year, the CFP Board announced the results of the latest Practice Study Analysis, which among other things, informs the board on necessary updates to the Principals Knowledge Topics. These topics are the base of approved educational provider curriculum, and are the topics tested on the CFP Board Exam. The March…
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