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Surrender Cost Index
Course: Insurance PlanningLesson 14: Purchasing and Pricing Life Insurance Student Question: The surrender cost index is so confusing in terms of what I need to know. And could you provide a definition for the annuity due factor? Matt Instructor Response: HI Matt, This can be confusing. Let’s take a full step back for perspective. The purpose of the Surrender Cost Index is…
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Donating Appropriate Stock
Darryl Owens will report an AGI of $100,000 for this year on his federal income tax return. Darryl would like to make a gift to the local hospital of some stock. He would like to donate the stock that will provide the greatest income tax deduction for this year. Which of the following stocks should…
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The Perils of Conduit Trusts for Retirement Accounts
Good to Know Once upon a time in a land not so far away, it was possible to defer (stretch) IRA retirement distributions over multiple generations at the death of an IRA owner. That idyllic time was before 2019 and the land in question is these United States of America. During that pre-2020 period, it…
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Impact of Retirement Timeline
Course: Retirement PlanningLesson 1: Using IRAs to Build and Distribute More Retirement Income Student Question: I am confused about this calculation (question below). If I use 20 years instead of 15 years, my need is now $90,305 from my own savings. The math makes sense but the answer does not. If I have an additional 5 years to save, shouldn’t the required out-of-pocket cash be less…
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Saving for a Retirement Goal
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 Removes Compensation Search Function
CFP Board Updates On March 2, 2020, the CFP Board notified all professionals that the compensation search function had been removed from the “Find Your CFP® Professional” tool on the letsmakeaplan.org website. The key decision point, according to the CFP Board, was that based on the new Code and Standards, all CFP® professionals are expected…
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Notifying Clients of Bankruptcy
Course: Fundamentals of Financial PlanningLesson 9: CFP Board Regulatory Requirements Student Question: For sub-section iv of Standard A-10(a), I’m a bit confused as to who that applies to. Does this apply to the certificate holder or the client? Will Instructor Response: Hi William- Thank you for the question. In A(10)a-IV, the CFP® certificant must provide this information to the client. Bruce Student Question: I…
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Alimony and Gross Income
Cindy received the following payments from her ex-husband Jim under the terms of the divorce decree: $10,000 of back alimony payments from last year $20,000 of back child support payments from last year $30,000 of alimony payments for this year $40,000 of child support payments for this year How much does Cindy have to include…
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How to Avoid or Reduce Student Loan Debt
Good to Know The juggernaut of student loan debt is a sad fact of life today for many families. But what if you could avoid or reduce student loan debt for you, your family and your clients? If that sounds unlikely, join us as we dispel three common myths that just might lighten the debt…
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