CFP EXAM PREP Verified Exam Questions and Answers Latest update 2026/202

CFP EXAM PREP
Verified Exam Questions and Answers Latest update 2026/2027

Question:
Advantages of Commuting Your Pension to a LIRA -
Answer:
Self
management of the investment and funds

- Can list a beneficiary and ease of estate process

- Removes reliance on plan sponsor

Question:
Disadvantages of Commuting Your Pension to a LIRA -
Answer:
Personal
risk of investments

- Potential loss of bridging benefits

- Some pensions are indexed and can lose that benefit

Question:
Commodity Prices rising is what type of indicator -
Answer:
Leading
Indicator

Question:
Advantages of IPP vs DCPP -
Answer:
IPP have higher contribution limits

- IPP offer guaranteed income

- IPP can be indexed and DCPP's cannot

- Employer or sponsor needs to cover shortfall and take on investment risk.

, Question:
Disadvantages of establishing an Inter vivos Trust -
Answer:
Costly to
establish and maintain

- Lose control of assets in the trust

- beneficiaries have restricted access to the asset

- subject to the 21-year rule

Question:
Advantages of inter vivos trusts -
Answer:
Avoids probate - assets pass
directly to beneficiaries
- passes future growth/income to beneficiaries

- protects assets from creditors

Question:
Deductible Expenses for Employees -
Answer:
Vehicle expenses if used for
work

- Home office expenses - if working from home is required.

- Professional Dues

Question:
Deductible Expenses for Self-Employed (Sole Proprietor) -