AFC Questions with CORRECT Answers

AFC Questions with CORRECT Answers

Question:
What is the role of a financial counselor?
Answer:
Focus on the clients goals active listening skills are paramount help clients gain new
insights goal is to work yourself out of a job


Question:
What are the goals of financial counseling?
Answer:
Help clients resovle immediate problems help them change ingrained problem behavior,


Question:
What is the purpose of the INITIATING stage of the counseling process? How do you
conduct it?
Answer:
To strive to build RAPPORT with clients and to reduce TENSION clients may feel. To build
trust; -Smile, firm handshake, eye contact, small talk, good communication Provide
overview of process/set expectations -ethics, roles, confidentiality, responsibilities
Transition to exploring by asking purpose of visit.


Question:
In the context of employee benefits, what is a cafeteria plan?
Answer:
When employees choose from a menu of TAXABLE and TAX REDUCING benefits.


Question:
Why do employers offer employee benefits?
Answer:
1. Increase retention 2. Attract best talent 3. Save on taxes


Question:
Define a REGRESSIVE tax system. Who pays proportionally more in this system?
Answer:
tax rate is the same for all. Lower income people pay proportionally more in taxes.

,Question:
Explain the main points of creating AN ACTION PLAN in the goal setting process
Answer:
After selecting solutions, establish an action plan Implement and monitor


Question:
Explain the main points of BRAINSTORMING in the goal setting process
Answer:
Do not censor ideas do not clarify do not assign names Use other people's ideas


Question:
Explain the continuous debt method. What is the formula?
Answer:
If you are unable to get completely out of debt (except mortgage) every 4 years, it
means you rely on debt too heavily


Question:
What is the function of the Fair Debt Collection Practices Act? Who does it apply to?
Answer:
Prohibits collectors from using abusive, unfair, or deceptive practices Applies only to
debt collectors


Question:
The _____ act requires that lenders disclose APR, Loan terms, and total cost IN WRITING
to the borrower
Answer:
Truth in lending act


Question:
Another name for a spending plan is _________?
Answer:
budget

, Question:
Which credit law, or act, gives all people an equal opportunity to apply for loans, the law
also protects against discrimination of race, color, national origin, sex, religion, marital
status, age, and public assistace.
Answer:
Equal credit opportunity act


Question:
empathy important?
Answer:
Empathy grows trust, which leads to goal achievement 1. emphatic understanding 2.
emphatic expression 3. emphatic communication


Question:
What is a money market account? Is it insured?
Answer:
A money market account is a high-interest bearing deposit account that can offer check
writing and debit cards Money-market accounts are not insured but are considered safe


Question:
Assets on the balance sheet are valued at their ___ ____ ___.
Answer:
Fair market value


Question:
During the expansion phase of the business cycle, what decreases?
Answer:
Unemployment, prices, interest rates


Question:
What is self awareness? Why is it important?
Answer:
Awareness of your personality, beliefs, knowledge, biases, attitudes, and preferences.
"Greater selfawareness leads to more effective counseling." Raising client
self-awareness regarding their beliefs, knowledge, biases, and preferences towards
money is a key factor in counseling.