Blog
Understanding the Relationship Between Coupon Rates and Duration
Course: Investment PlanningLesson 9: Fixed Income Securities Student Question: There is a question regarding duration that I continue to struggle with. Which of the following are true: Lower coupon bonds are more sensitive to interest rates than high coupon bonds.There is inverse relationship between bond prices and change in interest rates.There is a positive relationship between coupon rates…
Read More
Solving for Bond Yield
An investor bought a bond at par that matures in 10 years. The bond pays an annual coupon of $110 and the reinvestment rate is 7%. What is the realized compound yield of this bond? 7.23% 8.01% 9.67% 14.10% CLICK TO REVEAL ANSWER Expand C is the answer. One would anticipate a realized compound yield…
Read More
CFP Board Relaunches Financial Planning Website
CFP Board Updates Based on feedback from consumer research and user testing, the CFP Board has revamped and now relaunched the financial planning website – letsmakeaplan.org. The goal of the new website is to provide content that enables the consumer to gain a better understanding of the importance of financial planning and then how to…
Read More
Calculating Rate of Return
Course: Investment PlanningLesson 1: Key Principles of Investing Student Question: Hey Dan, Hope you are doing well. Can you help solve a practice question? I looked through the textbook and my notes and just couldn’t wrap my brain about how to solve the problem below. The confusing part to me is that the fund was not…
Read More
Solving for Mortgage Payment
Shannon refinanced her home mortgage to a 30-year fixed mortgage with biweekly payments. How much is each payment if she owed $350,000 at the time of the refinance and the interest rate is 4.5%? $818 $881 $1,012 $1,229 CLICK TO REVEAL ANSWER Expand A is the answer. Shannon pays her mortgage every two weeks which…
Read More
TOP 4 FINANCIAL CONCERNS OF THE PANDEMIC
CFP® Certificants in the News More than five of every ten Americans are experiencing “high” to “very high” financial stress levels as a result of the pandemic according to a survey commissioned by CFP Board and released December 3, 2020. Admittedly, that is hardly a seismic revelation. But if we dig below the headlines, you…
Read More
Passing Property Via Will
Course: Investment PlanningLesson 14: Evaluation Portfolio Performance Student Question: Hello – I’m a little confused about the example (below) discussing an heirloom of only sentimental value. Why would this be titled at all for a will, especially since an earlier lecture said items of no value would pass through the will as the situation does…
Read More
Impact on Net Worth
Last year, David paid down his motorcycle loan by $4,000 and his school loan by $8,000. He was also able to add $11,000 to his IRA from his checking account. David’s investment account grew by $15,000 during the year. How much did David’s net worth increase for the year? $12,000 $23,000 $27,000 $38,000 CLICK TO…
Read More
The Georgia Senate Races and Personal Tax Planning
Good to Know- Income Tax Top Marginal Income Tax Rates Current Status: The maximum marginal income tax rate is 37% and, for example, would apply to a single taxpayer with taxable income greater than $523,600 (2021, as indexed under current law). Potential 2021 Change: The top marginal rate could increase to 39.6% and would apply…
Read More