Module One
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?
A. Comprehensive Planning
B. Targeted Planning
C. Investment Planning
D. Risk management Planning - answerA. Comprehensive Planning
A planner who addresses only the purchase of a first home for a client is practicing
A. Targeted Financial Planning
B. Mortgage Financing
C. Comprehensive Financial Planning
D. Investment Counseling - answerA. Targeted Financial Planning
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?
A) Confirmation bias
B) Conservation bias
C) Self-control bias
D) Mental accounting - answerD) Mental accounting
Which of the following is a characteristic of properly stated financial goals?
A) General
B) Broad
C) Flexible
D) Definite - answerD) Definite
When helping clients identify goals, financial planners should practice active listening
skills by engaging in all of these except
A) offering suggestions for goals.
B) summarizing what the planner has heard.
C) paraphrasing what the clients have said.
D) restating the clients' goals. - answerA) offering suggestions for goals.
, Which of the following financial goals is written correctly?
A) To invest $5,000 a year for retirement
B) To accumulate $40,000 in seven years for a down payment on a house
C) To accumulate funds within the next 10 years for a child's college expenses
D) To set aside 10% of income to replace a car - answerB) To accumulate $40,000 in
seven years for a down payment on a house
During which of the following steps in the financial planning process is the current yield
from already-invested assets first identified?
A) Implementing the financial planning recommendations
B) Developing the financial planning recommendations
C) Analyzing the client's current course of action and potential alternate course(s) of
action
D) Understanding the client's personal and financial circumstances - answerD)
Understanding the client's personal and financial circumstances
Asset categories that are appropriate for the client are determined during which of the
following steps of the financial planning process?
A) Understanding the client's personal and financial circumstances
B) Analyzing the client's current course of action and potential alternate course(s) of
action
C) Developing the financial planning recommendations
D) Implementing the financial planning recommendations - answerC) Developing the
financial planning recommendations
During which of the following steps of the financial planning process is the performance
of a client's investments reviewed periodically?
A) Monitoring progress and updating
B) Understanding the client's personal and financial circumstances
C) Developing the financial planning recommendations
D) Analyzing the client's current course of action and potential alternate course(s) of
action - answerA) Monitoring progress and updating
Potential problems that might interfere with clients achieving their objectives are
identified in which of the following steps in the financial planning process?
A) Implementing the financial planning recommendations
B) Analyzing the client's current course of action and potential alternate course(s) of
action
C) Developing the financial planning recommendations
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?
A. Comprehensive Planning
B. Targeted Planning
C. Investment Planning
D. Risk management Planning - answerA. Comprehensive Planning
A planner who addresses only the purchase of a first home for a client is practicing
A. Targeted Financial Planning
B. Mortgage Financing
C. Comprehensive Financial Planning
D. Investment Counseling - answerA. Targeted Financial Planning
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?
A) Confirmation bias
B) Conservation bias
C) Self-control bias
D) Mental accounting - answerD) Mental accounting
Which of the following is a characteristic of properly stated financial goals?
A) General
B) Broad
C) Flexible
D) Definite - answerD) Definite
When helping clients identify goals, financial planners should practice active listening
skills by engaging in all of these except
A) offering suggestions for goals.
B) summarizing what the planner has heard.
C) paraphrasing what the clients have said.
D) restating the clients' goals. - answerA) offering suggestions for goals.
, Which of the following financial goals is written correctly?
A) To invest $5,000 a year for retirement
B) To accumulate $40,000 in seven years for a down payment on a house
C) To accumulate funds within the next 10 years for a child's college expenses
D) To set aside 10% of income to replace a car - answerB) To accumulate $40,000 in
seven years for a down payment on a house
During which of the following steps in the financial planning process is the current yield
from already-invested assets first identified?
A) Implementing the financial planning recommendations
B) Developing the financial planning recommendations
C) Analyzing the client's current course of action and potential alternate course(s) of
action
D) Understanding the client's personal and financial circumstances - answerD)
Understanding the client's personal and financial circumstances
Asset categories that are appropriate for the client are determined during which of the
following steps of the financial planning process?
A) Understanding the client's personal and financial circumstances
B) Analyzing the client's current course of action and potential alternate course(s) of
action
C) Developing the financial planning recommendations
D) Implementing the financial planning recommendations - answerC) Developing the
financial planning recommendations
During which of the following steps of the financial planning process is the performance
of a client's investments reviewed periodically?
A) Monitoring progress and updating
B) Understanding the client's personal and financial circumstances
C) Developing the financial planning recommendations
D) Analyzing the client's current course of action and potential alternate course(s) of
action - answerA) Monitoring progress and updating
Potential problems that might interfere with clients achieving their objectives are
identified in which of the following steps in the financial planning process?
A) Implementing the financial planning recommendations
B) Analyzing the client's current course of action and potential alternate course(s) of
action
C) Developing the financial planning recommendations
