Student Question

Course: Income Tax PlanningLesson 1: Using IRAs to Build and Distribute More Retiremnt Income Student Question: Is it okay to roll over ( via direct trustee, not 60–day) from Traditional to Roth several times throughout the year if needed? Thanks, Matt Instructor Response: Great question Matt. The IRS limits tax-free IRA rollovers to one per…

Course: Insurance PlanningLesson 2: Fundamentals of Insurance Student Question: I’m having difficulty seeing the difference between pro-rata liability, contribution by equal shares, and primary and excess. Could you explain the review exercise? Review Exercise Three companies insure Josh’s $250,000 house. Insurer A has it insured for 10%, insurer B for 35%, and insurer C for…

Course: Income Tax PlanningLesson 10: Social Security Student Question: Does the retired worker have to also be drawing on their Social Security benefits for the unmarried child of the retired worker to receive benefits? For instance, a 63-year-old man has a 13-year-old daughter and he is retired but not drawing his SS benefits yet? Melinda…

Course: Investment Planning Lesson 14: Evaluating Portfolio Performance Student Question: For both the Treynor and Sharpe, part of the calculation involves using the average portfolio return (rp). In most examples, the average portfolio return is being given. However, if I need to calculate this in real life, do I use the dollar-weighted return (internal rate…

Course: Income Tax Planning Lesson 3: Accounting of Gross Income Student Question: The first example in “Recognizing Income” about not recognizing the check payment until it can actually be cashed seems contradictory to the CFP Board question below which states that income is included when a check is RECEIVED. Any clarification you can provide here? Thanks. Jay Coursework…

Course: Retirement Planning Lesson 8: Fitting Deferred Compensation into the Retirement Plan Student Question: Curious as to why the net result is $525,000.00 and not $500,000.00. Wouldn’t 100% of her current year compensation be $500,000.00? Is it just that the Board decided to max out the limits of the DBP and the NQEBP so that’s…

Course: Investment Planning Lesson 2: Securities Markets and the Fed Student Question: The coursework states that the SIPC will pay claims up to $500,000, but in Example 2, they only gave Bruce $350,000. Why is that? Thanks. Wesley Example 2 Bruce had $400,000 in cash and $100,000 in securities in his brokerage account. His broker/dealer…

Course: Investment Planning Lesson 4: International Equity Securities Student Question: Is it not true that ADRs eliminate currency risk because transactions are done in USD? Lafe   Instructor Response: Great question Lafe. ADRs do not guarantee exchange rates; they merely exchange foreign currency to US$ as a convenience to ADR investors. Changes in the exchange rate…

Course: Fundamentals of Financial Planning Lesson 2: Economic Concepts and Consumer Protection Laws Student Question: I was really hoping I could get some sort of expanded reasoning on the below statement if possible, please. I am having a hard time wrapping my head around this for some reason. I tried to Google this and look…

Course: Investment Planning Lesson 15: Fundamentals of Derivatives – Futures and Options Student Question: So, if the max loss on a short put is the strike price less the premium, and the breakeven point is also the strike price minus the premium, does that mean the max loss is breaking even? And does the same…