FP 511 EXAM AND PRACTICE EXAM NEWEST 2025 ACTUAL EXAM TEST BANK QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED A+
Which of the following activities would be appropriate if you were establishing and defining the client-
planner relationship or gathering information necessary to fulfill the engagement?
1 Collecting personal financial information
2 Inquiring about the number of dependents
3 Inquiring about the age or dates of birth of dependents
4 Determining which stocks to purchase for the client's investment portfolio - (ANSWER)1-3
Establishing and defining the client-planner relationship does not include determining which stocks or
investments to purchase. This occurs in the fourth phase of the financial planning process, developing
the recommendations.
Which of the following CFP® certificants would likely be considered to be engaged in financial planning
or the material elements of financial planning?
1 Lance, who reviews a life insurance sales brochure with his client, Arthur, and completes a variable life
insurance application
2 Nadia, who conducts comprehensive data gathering regarding Jason's investments, life insurance,
retirement plans, wills, and trusts and makes recommendations for him - (ANSWER)2
Because Nadia's services involve several of the financial planning subject areas and she is involved in the
elements of financial planning, she is likely providing financial planning. Lance's service to Arthur is
limited, and the engagement would likely not be considered financial planning.
According to CFP Board Code of Ethics, Connor, a CFP® professional, is responsible for which of the
following?
1 Acting in the client's best interests
2 Avoiding or disclosing and managing conflicts of interest
3 Acting with honesty, integrity, competence, and diligence
4 Maintaining the confidentiality and protect the privacy of client information - (ANSWER)All
,FP 511 EXAM AND PRACTICE EXAM NEWEST 2025 ACTUAL EXAM TEST BANK QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED A+
CFP® professional must
Act with honesty, integrity, competence, and diligence.
Act in the client's best interests.
Exercise due care.
Avoid or disclose and manage conflicts of interest.
Maintain the confidentiality and protect the privacy of client information.
Act in a manner that reflects positively on the financial planning profession and CFP® certification.
Amanda, a CFP® professional, is enjoying an afternoon at her son's school playground when she is
approached by Tracy, a fellow parent and teacher at a local elementary school. Their conversation
covers specifics about Tracy's personal and financial situation, with emphasis on a recommended
investment strategy for her 403(b) account. Amanda is aware that she is providing Financial Advice to
Tracy. Identify the correct application of rules from the Code and Standards based on Amanda and
Tracy's interaction. - (ANSWER)Although only Financial Advice has been determined, Amanda must
uphold her Fiduciary Duty and must follow the Code of Ethics.
As a CFP® professional, Amanda is obligated to uphold the Code of Ethics. In addition, since Financial
Advice is occurring, Amanda must act as a Fiduciary, in the best interest of Tracy. The introduction of the
Code and Standards specifically states "The Code of Ethics applies at all times, and sets forth principles
that guide the behavior of CFP® professionals, with elaboration provided in the Standards."
Bill and Sophia have recently retired and want to travel to Europe and then volunteer for local mission
work. They would also like to meet with Humphrey, their financial planner, to discuss charitable
contributions they would like to make to these local missions. Humphrey should determine Bill and
Sophia's life cycle phase to be - (ANSWER)the distribution phase.
The distribution/gifting phase begins subtly when a couple realizes that they can afford to spend on
things they never believed possible. The asset accumulation and conservation/protection phases make
this phase possible. For many people, there is a period when they are being influenced by all three
phases simultaneously, though not necessarily to the same degree.
,FP 511 EXAM AND PRACTICE EXAM NEWEST 2025 ACTUAL EXAM TEST BANK QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED A+
Whitney is designing her new email template which will reflect her recent certification as a CFP®
professional. Under her name, she has identified herself as a CFP™. In a tagline at the bottom of the
template, she advertises herself as a "CFP® expert." According to CFP Board's guidelines regarding how
the CFP®" marks may be used, which of the following is CORRECT?
1 Whitney has appropriately identified herself as a CFP™.
2 Advertising herself as a CFP® expert is prohibited by CFP Board. - (ANSWER)2
Although, Whitney can identify herself as a CFP®, it must be done behind her name, not under it. If
Whitney wants to identify herself under her name, she should do so as a ™. Statement II is correct.
"CFP®" must always be used with one of CFP Board's approved nouns ("certificant", "professional",
"practitioner", "certification", "mark", or "exam") unless directly following the name of the individual
certified by CFP Board. Here, it can be used alone.
Maxine, age 57, would like to retire in 10 years. Currently, her debt is decreasing as her cash flow and
net worth are steadily increasing. Based on Maxine's current financial life cycle phase, which of the
following goals is she likely to have? - (ANSWER)Long-term goals, such as investing for retirement
Maxine is in the conservation/protection phase of the financial life cycle. As such, her goals are likely
longer-term goals, such as investing to provide for future retirement income. In the accumulation phase
of the financial life cycle, clients have only limited discretionary income and, as a result, they are likely to
focus on short-term, cost-of-living goals. Finally, in the distribution/gifting phase, estate planning and
capital preservation are usually most important.
Blanca, a CFP® professional, has recently entered into a financial planning engagement with Simon. As
his financial planner, which of the following are Blanca's roles?
1 Analyzing Simon's current financial status
2 Assisting Simon in implementing the financial plan
3 Helping Simon identify financial goals and objectives - (ANSWER)all
, FP 511 EXAM AND PRACTICE EXAM NEWEST 2025 ACTUAL EXAM TEST BANK QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED A+
The financial planner is responsible for analyzing clients' financial status, assisting clients in
implementing their financial plans, and making recommendations based on the client's goals and
objectives.
*** Candice has referred Rochelle, a CFP® professional, to her brother, Nelson. In their initial meeting,
Rochelle explains how she can help Nelson develop a comprehensive financial plan. Which of the
following would be Rochelle's roles in a client-planner relationship with Nelson?
1 Assisting Nelson in identifying his goals
2 Analyzing Nelson's current financial status
3 Recommending strategies that will meet Nelson's business goals
4 Providing documentation Rochelle needs to complete the financial plan - (ANSWER)1,2,3
Rochelle is responsible for helping Nelson with identifying his goals and making recommendations based
on those goals. She is also responsible for analyzing Nelson's current financial status. Nelson has the
duty to provide documentation Rochelle needs to complete the financial plan.
In 2012, the average cost of a new home in Oakville was $150,000. In 2014 the average cost rose to
$210,000. Due to an economic downturn in 2017, the average cost of a new home fell to $185,000, and
the reaction to the decreased cost was positive, even though the new average cost was higher than the
2012 average cost of a new home. This behavior is known as - (ANSWER)anchoring.
When the average cost of a new home rose in 2014 to $210,000, home buyers reset their psychological
anchors to that cost. As the price declined in 2017 to $185,000, the reaction was positive because it was
considered in light of the higher 2014 price.
*** Recently, Fallon, an avid shopper, has heard from her friends that an investment in Shoes-2-You
stock was a wise idea because the shoes sold are very stylish. Even though Fallon's financial planner has
advised her that investing in this stock is a poor decision, she invests in it anyway. Her brother, Stanley,
congratulates her on her investment because he feels it is a wise investment. Stanley considers himself
to be an expert in investments. Unfortunately, he considers his expertise to be much greater than it
actually is. In the past, Stanley has taken credit for any investment decisions that have positive returns
but blames the economy when an investment does poorly. Considering Fallon's and Stanley's behavior,
AND CORRECT DETAILED ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED A+
Which of the following activities would be appropriate if you were establishing and defining the client-
planner relationship or gathering information necessary to fulfill the engagement?
1 Collecting personal financial information
2 Inquiring about the number of dependents
3 Inquiring about the age or dates of birth of dependents
4 Determining which stocks to purchase for the client's investment portfolio - (ANSWER)1-3
Establishing and defining the client-planner relationship does not include determining which stocks or
investments to purchase. This occurs in the fourth phase of the financial planning process, developing
the recommendations.
Which of the following CFP® certificants would likely be considered to be engaged in financial planning
or the material elements of financial planning?
1 Lance, who reviews a life insurance sales brochure with his client, Arthur, and completes a variable life
insurance application
2 Nadia, who conducts comprehensive data gathering regarding Jason's investments, life insurance,
retirement plans, wills, and trusts and makes recommendations for him - (ANSWER)2
Because Nadia's services involve several of the financial planning subject areas and she is involved in the
elements of financial planning, she is likely providing financial planning. Lance's service to Arthur is
limited, and the engagement would likely not be considered financial planning.
According to CFP Board Code of Ethics, Connor, a CFP® professional, is responsible for which of the
following?
1 Acting in the client's best interests
2 Avoiding or disclosing and managing conflicts of interest
3 Acting with honesty, integrity, competence, and diligence
4 Maintaining the confidentiality and protect the privacy of client information - (ANSWER)All
,FP 511 EXAM AND PRACTICE EXAM NEWEST 2025 ACTUAL EXAM TEST BANK QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED A+
CFP® professional must
Act with honesty, integrity, competence, and diligence.
Act in the client's best interests.
Exercise due care.
Avoid or disclose and manage conflicts of interest.
Maintain the confidentiality and protect the privacy of client information.
Act in a manner that reflects positively on the financial planning profession and CFP® certification.
Amanda, a CFP® professional, is enjoying an afternoon at her son's school playground when she is
approached by Tracy, a fellow parent and teacher at a local elementary school. Their conversation
covers specifics about Tracy's personal and financial situation, with emphasis on a recommended
investment strategy for her 403(b) account. Amanda is aware that she is providing Financial Advice to
Tracy. Identify the correct application of rules from the Code and Standards based on Amanda and
Tracy's interaction. - (ANSWER)Although only Financial Advice has been determined, Amanda must
uphold her Fiduciary Duty and must follow the Code of Ethics.
As a CFP® professional, Amanda is obligated to uphold the Code of Ethics. In addition, since Financial
Advice is occurring, Amanda must act as a Fiduciary, in the best interest of Tracy. The introduction of the
Code and Standards specifically states "The Code of Ethics applies at all times, and sets forth principles
that guide the behavior of CFP® professionals, with elaboration provided in the Standards."
Bill and Sophia have recently retired and want to travel to Europe and then volunteer for local mission
work. They would also like to meet with Humphrey, their financial planner, to discuss charitable
contributions they would like to make to these local missions. Humphrey should determine Bill and
Sophia's life cycle phase to be - (ANSWER)the distribution phase.
The distribution/gifting phase begins subtly when a couple realizes that they can afford to spend on
things they never believed possible. The asset accumulation and conservation/protection phases make
this phase possible. For many people, there is a period when they are being influenced by all three
phases simultaneously, though not necessarily to the same degree.
,FP 511 EXAM AND PRACTICE EXAM NEWEST 2025 ACTUAL EXAM TEST BANK QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED A+
Whitney is designing her new email template which will reflect her recent certification as a CFP®
professional. Under her name, she has identified herself as a CFP™. In a tagline at the bottom of the
template, she advertises herself as a "CFP® expert." According to CFP Board's guidelines regarding how
the CFP®" marks may be used, which of the following is CORRECT?
1 Whitney has appropriately identified herself as a CFP™.
2 Advertising herself as a CFP® expert is prohibited by CFP Board. - (ANSWER)2
Although, Whitney can identify herself as a CFP®, it must be done behind her name, not under it. If
Whitney wants to identify herself under her name, she should do so as a ™. Statement II is correct.
"CFP®" must always be used with one of CFP Board's approved nouns ("certificant", "professional",
"practitioner", "certification", "mark", or "exam") unless directly following the name of the individual
certified by CFP Board. Here, it can be used alone.
Maxine, age 57, would like to retire in 10 years. Currently, her debt is decreasing as her cash flow and
net worth are steadily increasing. Based on Maxine's current financial life cycle phase, which of the
following goals is she likely to have? - (ANSWER)Long-term goals, such as investing for retirement
Maxine is in the conservation/protection phase of the financial life cycle. As such, her goals are likely
longer-term goals, such as investing to provide for future retirement income. In the accumulation phase
of the financial life cycle, clients have only limited discretionary income and, as a result, they are likely to
focus on short-term, cost-of-living goals. Finally, in the distribution/gifting phase, estate planning and
capital preservation are usually most important.
Blanca, a CFP® professional, has recently entered into a financial planning engagement with Simon. As
his financial planner, which of the following are Blanca's roles?
1 Analyzing Simon's current financial status
2 Assisting Simon in implementing the financial plan
3 Helping Simon identify financial goals and objectives - (ANSWER)all
, FP 511 EXAM AND PRACTICE EXAM NEWEST 2025 ACTUAL EXAM TEST BANK QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED A+
The financial planner is responsible for analyzing clients' financial status, assisting clients in
implementing their financial plans, and making recommendations based on the client's goals and
objectives.
*** Candice has referred Rochelle, a CFP® professional, to her brother, Nelson. In their initial meeting,
Rochelle explains how she can help Nelson develop a comprehensive financial plan. Which of the
following would be Rochelle's roles in a client-planner relationship with Nelson?
1 Assisting Nelson in identifying his goals
2 Analyzing Nelson's current financial status
3 Recommending strategies that will meet Nelson's business goals
4 Providing documentation Rochelle needs to complete the financial plan - (ANSWER)1,2,3
Rochelle is responsible for helping Nelson with identifying his goals and making recommendations based
on those goals. She is also responsible for analyzing Nelson's current financial status. Nelson has the
duty to provide documentation Rochelle needs to complete the financial plan.
In 2012, the average cost of a new home in Oakville was $150,000. In 2014 the average cost rose to
$210,000. Due to an economic downturn in 2017, the average cost of a new home fell to $185,000, and
the reaction to the decreased cost was positive, even though the new average cost was higher than the
2012 average cost of a new home. This behavior is known as - (ANSWER)anchoring.
When the average cost of a new home rose in 2014 to $210,000, home buyers reset their psychological
anchors to that cost. As the price declined in 2017 to $185,000, the reaction was positive because it was
considered in light of the higher 2014 price.
*** Recently, Fallon, an avid shopper, has heard from her friends that an investment in Shoes-2-You
stock was a wise idea because the shoes sold are very stylish. Even though Fallon's financial planner has
advised her that investing in this stock is a poor decision, she invests in it anyway. Her brother, Stanley,
congratulates her on her investment because he feels it is a wise investment. Stanley considers himself
to be an expert in investments. Unfortunately, he considers his expertise to be much greater than it
actually is. In the past, Stanley has taken credit for any investment decisions that have positive returns
but blames the economy when an investment does poorly. Considering Fallon's and Stanley's behavior,
