LIBF UNIT 2 TEST WITH COMPLETE
QUESTIONS AND ANSWERS [
GUARANTEED A+]
1.1 Outline the need for financial planning. - ✔️✔️Make better financial
decisions
Avoid unnecessary debt
Help make decisions on savings, spending and progress in reaching goals
Helps show what you have to do to get to where you want to be
1.2 Explain the personal factors which influence financial planning. -
✔️✔️Factors influenced by stage in life cycle
Attitude to risk
©morren2025/2026.Year published 2026.
,Attitude to Risk - ✔️✔️a. Risk tolerance - how does the individual feel about
the possibility of losing money?
b. Capacity for loss - how much money can the individual afford to lose?
Stages in life cycle - ✔️✔️Childhood 0-12
Teenage 13-19
Young Adult 18-25
Mature Adult 26-40
Middle Age 41-54
Late Middle Age 55-65
Old Age 65+
Each of the stages has its own typical opportunities, challenges and needs.
1.3 Identify sources of financial planning information and advice. -
✔️✔️Advisory services (CAB, Money Advice Service, charities, financial
advisers)
Financial service providers (banks, building societies, credit unions)
©morren2025/2026.Year published 2026.
, Citizens Advice Bureau - ✔️✔️Citizens Advice provides free, confidential and
independent advice to help people make the right choices, including help
to deal with debt problems, how to avoid losing their home and how to get
their finances back into shape.
Money Advice Service - ✔️✔️Free and impartial money advice, set up by
government. Offers advice and guides to help improve finances. Tools and
calculators to help keep track and plan ahead. Support over the phone and
online
The Money Charity - ✔️✔️empower people across the UK to build the skills,
knowledge, attitudes and behaviours, to make the most of their money
throughout their lives
Financial Advisers - ✔️✔️Independent financial advisers (IFAs) must
recommend products and solutions from the whole of the market
©morren2025/2026.Year published 2026.
QUESTIONS AND ANSWERS [
GUARANTEED A+]
1.1 Outline the need for financial planning. - ✔️✔️Make better financial
decisions
Avoid unnecessary debt
Help make decisions on savings, spending and progress in reaching goals
Helps show what you have to do to get to where you want to be
1.2 Explain the personal factors which influence financial planning. -
✔️✔️Factors influenced by stage in life cycle
Attitude to risk
©morren2025/2026.Year published 2026.
,Attitude to Risk - ✔️✔️a. Risk tolerance - how does the individual feel about
the possibility of losing money?
b. Capacity for loss - how much money can the individual afford to lose?
Stages in life cycle - ✔️✔️Childhood 0-12
Teenage 13-19
Young Adult 18-25
Mature Adult 26-40
Middle Age 41-54
Late Middle Age 55-65
Old Age 65+
Each of the stages has its own typical opportunities, challenges and needs.
1.3 Identify sources of financial planning information and advice. -
✔️✔️Advisory services (CAB, Money Advice Service, charities, financial
advisers)
Financial service providers (banks, building societies, credit unions)
©morren2025/2026.Year published 2026.
, Citizens Advice Bureau - ✔️✔️Citizens Advice provides free, confidential and
independent advice to help people make the right choices, including help
to deal with debt problems, how to avoid losing their home and how to get
their finances back into shape.
Money Advice Service - ✔️✔️Free and impartial money advice, set up by
government. Offers advice and guides to help improve finances. Tools and
calculators to help keep track and plan ahead. Support over the phone and
online
The Money Charity - ✔️✔️empower people across the UK to build the skills,
knowledge, attitudes and behaviours, to make the most of their money
throughout their lives
Financial Advisers - ✔️✔️Independent financial advisers (IFAs) must
recommend products and solutions from the whole of the market
©morren2025/2026.Year published 2026.
