Questions of the Week

Course: Retirement PlanningLesson 5: Leveraging Nonqualified Plans for Small Business and Not-For-Profit Employees and Owners Student Question: Hi- I’m trying to distinguish when the required minimum distribution amounts are at 72 years old versus when they are 70½.  IRAs are now 72, correct?  Is a 401k Plan and a 403b Plan at 70½? Thanks Tiffany Instructor…

Course: Insurance PlanningLesson 17: Business Uses of Life and Disability Insurance Student Question: Hope you’re well and keeping safe. I do 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? Thanks Emerito Instructor Response: Hi Emerito, Great question.  A buy-sell…

Course: Fundamentals of Financial PlanningLesson 9: CFP Board Regulatory Requirements Student Question: 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 is…

Course: Investment PlanningLesson 15: Fundamentals of Derivatives – Futures and Options Student Question: Can you please explain what Basis points are and how/why they are generally used? Thanks Lana Instructor Response: Hi Lana, There are 100 basis points in 1%.  Basis points are merely a common method of measuring investment fees or returns.   An exchanged-traded fund may charge…

Course:  Income Tax PlanningLesson 15: Property Transactions Student Question: Dear Greene Consulting Team –  In the lesson, deducting donations of “cash” versus “long term appreciated securities” are differentiated. I’m curious about “short-term appreciated securities”.  In other words, if I own a stock – bought at $10,000 and it’s worth $50,000 when I donate, but I’ve only owned it 6 months…

Course:  Estate PlanningLesson 4: Transfer Taxation I – Common Elements of Estate and Gift Taxes Student Question: Hello, Can I get some clarification on the Gift and Estate tax? As I understand it, individuals can gift up to $15,000 per year without “triggering” a gift tax; however, they still have the lifetime exemption of $11.58 million. Gifts over $15,000 per…

Course:  Estate PlanningLesson 3: Understanding Trusts and Trust Documents Student Question: In the example, I would think Northwestern would have a future, contingent interest as their interest is dependent upon the death of the wife. But the feedback tells me it’s a vested interest. Do we assume death is inevitable and, therefore, not a contingent-worthy contingency? EXAMPLE: During the life of…

Course:  Estate PlanningLesson 7: Transfer Taxation IV – Generation-Skipping Transfers Student Question: Regarding the example below, would the death of the father Stephen not move Andrew one step up, making him only one generation below Mrs. Jones? Would this not remove the Generation-Skipping Transfer Tax? EXAMPLE: Upon her death, Mrs. Jones left her estate in trust to provide income for life to…

Course:  Retirement PlanningLesson 7: Income Distribution Planning for Qualified Plans Student Question: Regarding the after-tax example: Wouldn’t the full $10,000 hardship come first from the $80,000 that was contributed pre-1987? Don’t you exhaust the $80,000 before concerning yourself with the exclusion ratio? From the Course: Once the pre-1987 after-tax contributions have been withdrawn, or if none existed, all other after-tax contributions are withdrawn on…

Course:  Insurance PlanningLesson 4: Homeowners Insurance Student Question: Is there a definition for personal injury as noted under the personal injury endorsement? FROM LESSON: The personal injury endorsement expands the Section II liability coverage to include “personal injury” and “bodily harm, sickness or disease.” How does this vary from bodily injury that is covered without an endorsement? Thanks. Matthew Instructor…