Module 1 Quiz

Question 1

A client is seeking guidance in all areas of financial planning. Which of the following most closely describes the type of financial planning the client wants?

Answer 1

Comprehensive planning

Question 2

A planner who addresses only the purchase of a first home for a client is practicing _____.

Answer 2

Targeted financial planning

Question 3

Kiara has accumulated $10,000 in a savings account over the last few years and has earmarked that money as a down payment on a luxury boat. Her central air conditioner breaks and requires $5,000 in repairs. Kiara is reluctant to spend the money in her savings account to make the repairs because she wants to use that money for the boat down payment. Instead, she puts the $5,000 repair charge on her credit card at an annual interest rate of 23%. This is an example of which of these behaviors?

Answer 3

Mental accounting

Question 4

Which of the following is a characteristic of properly stated financial goals?

Answer 4

Definite

Question 5

When helping clients identify goals, financial planners should practice active listening skills by engaging in all of these except _____.

Answer 5

Offering suggestions for goals

Question 6

During which of the following steps in the financial planning process is the current yield from already-invested assets first identified?

Answer 6

Understanding the client’s personal and financial circumstances

Question 7

Asset categories that are appropriate for the client are determined during which of the following steps of the financial planning process?

Answer 7

Developing the financial planning recommendations

Question 8

During which of the following steps of the financial planning process is the performance of a client’s investments reviewed periodically?

Answer 8

Monitoring progress and updating

Question 9

Potential problems that might interfere with clients achieving their objectives are identified in which of the following steps in the financial planning process?

Answer 9

Analyzing the client’s current course of action and potential alternate course(s) of action

Question 10

Which of these would NOT be considered quantitative data?

Answer 10

Health status

Question 11

Which of the following is something a financial planner would want to know when creating a financial plan?

1. Insurance needs
2. Retirement income objectives
3. Acceptable investment strategies
4. Liquid assets available for emergencies

Answer 11

1, 2, 3, and 4

Question 12

Which of the seven steps of the financial planning process follows the development of the financial planning recommendations?

Answer 12

Presenting the financial planning recommendations

Question 13

Which of these is the best description of a fiduciary?

Answer 13

A fiduciary always puts the best interests of the client first

Question 14

It is generally recommended by planners that an emergency fund be established. Which of the following guidelines is recommended?

Answer 14

Three to six months of living expenses in liquid investments

Question 15

Which of these statements regarding financial planning is CORRECT?

Answer 15

Data gathering for a financial planning engagement includes both quantitative and qualitative data

Question 16

Which of the following is a well-written goal?

Answer 16

To accumulate $500,000, by starting to save today, for retirement in 20 years

Question 17

Limited resources is the main reason for _____.

Answer 17

Prioritizing goals

Question 18

Which of the following is NOT a requirement of a properly stated goal?

Answer 18

Justification

Question 19

All of these are Standards of Professional Conduct in the FPQP® Code of Ethics except _____.

Answer 19

Experience

Question 20

When examinating retirement plan issues, which are the least likely to be considered?

Answer 20

Debt ratios

Question 21

Which one of these is NOT a requirement to become a Financial Paraplanner Qualified Professional designee?

Answer 21

Bachelor’s degree

Question 22

Which of these Financial Paraplanner Qualified Professional℠ Standards of Professional Conduct is matched with its CORRECT definition?

Answer 22

Diligence - respond to reasonable client inquiries in a timely manner

Question 23

The FPQP® Code of Ethics requires compliance with all of these components except _____.

Answer 23

Observance of state statutes

Question 24

Marcus is meeting with his clients, Ren and Amari, to define their goals. Ren tells Marcus one of his goals is purchasing a hunting camp in two years, and Amari rolls her eyes. What is the best action for Marcus to take next?

Answer 24

Recommend how Ren and Amari can pay for the camp

Question 25

Which of these is especially important when discussing estate planning with a client?

Answer 25

Titling of assets and property

Question 26

Which of these often occurs when developing financial planning recommendations?

Answer 26

Consideration of the economic environment and financial resources

Question 27

Which of these designations or certifications is best suited for an assistant working with a financial planner?

Answer 27

Financial Paraplanner Qualified Professional℠(FPQP)®

Question 28

Which of these helps clients shift their perspectives by considering circumstances, feelings, and thoughts from another perspective?

Answer 28

Reframing

Question 29

Which of these is NOT a correct statement about the requirements of being a Financial Paraplanner Qualified ProfessionalSM designee?

Answer 29

A FPQP® designee must engage in 30 hours of continuing education every two years to maintain active status

Question 30

Which of the following financial goals is written correctly?

Answer 30

To accumulate $40,000 in seven years for a down payment on a house