c. is shaped by the control system requirements. d. decreases organizational flexibility. If interest rates and inflation are low and there is liquidity in the credit markets, __________. The most commonly noted spreads are those between Treasury and corporate securities of the same maturity. Being able to realise our plans requires objectives, information, organisation and compromise. Leveraged funds are riskier than funds that do not use leverage because they __________. Financial statement preparation and analysis (including cash flow analysis/planning and budgeting), B. Begins when a person realizes that he can afford to spend on things he may have never believed possible, Risk tolerance: investor's willingness to accept risk (e.g., declines in the value of his investments), a.) Start studying ch. This is an example of __________. An alternative to a promise of "satisfaction guaranteed" on a product is __________. must be followed by any person allowed to use the CFP® marks, regardless of his nature of employment, title, role, or compensation structure. Individual factors may affect all the following financial situations EXCEPT __________. A summary of income and expenses over a period of time is called __________. When you invest in stocks you __________. Commodities include all the following EXCEPT __________. C. analyze your current personal and financial situation. Examples of non-recurring expenditures are __________. Your risk tolerance represents __________. During the Information Gathering & Goal Setting step in the financial planning process, the Financial Planner _____. Financial advisors may assist through all the following services EXCEPT __________. He pays $1,000 a month for rent, $300 a month toward his car, and his other expenses come to around $1,200 a month. a number only apply when a CFP professional is engaged in financial planning or material elements of the financial planning process, a. Even though you’re both the client and the planner, you should still make sure to identify roles for other people involved. Strategic Planning Process. This is why the plan needs to be monitored and tweaked from time to time. A group created to buy and manage commercial property is called a __________. Becky graduated with a master's degree in Personal Financial Planning. Step 1: Defining the Client-Planner Relationship. Determine your strategic position Identify and disclose conflicts of interest in client relationships 6.) You can actually do (most) of it at home. In financial planning, effective goals are __________. Which kind of financial statement does she need? The financial decision making process is complicated by all of the following factors EXCEPT _____. How would you classify these activities in your cash flow statement? a. it will be easier for buyers to borrow. An important part of the planning process is to be aware of the business opportunities in the firm’s external environment as well as within the firm. Your prime directive as a consumer is to __________. A loan structured such that money can be borrowed as needed, up to a limit, and paid down as desired, and interest is paid regularly but only on the outstanding balance. Your financial planning should reflect the realities of your career choice because your choice of career affects your __________. A realistic look must be taken at the prospect of these new opportunities and SWOT analysisshould be done. This is an example of __________. I will try to outline the basic concept of the Financial Pyramid as it applies to personal financial planning.. e. increases … This is where are a financial planning-focused financial advisor can come in handy. The budget that shows nonrecurring events that are usually associated with long-term financial goals, Income remaining after the deduction of living expenses and debt obligations that is available for capital expenditures or investment. Dylan earns $24,500 a year as an office worker. - Common metrics and a process or guidelines that enable effective assessment. 5. After working two years in a small financial planning firm, Becky earns $60,000 annually and saves $10,000 a year. A budget for long-term goals involving non-recurring items is called a/an __________. b. the number of factors to consider. Select one: a. uncertainty and risk. Completing paperwork to open a brokerage account, Defines the legal relationship between the financial planner and the client, Domain 1 - Establishing and defining the client-planner relationship, Establishing and Defining the Client-Planner Relationship (Domain 1), Gathering Information Necessary to Fulfill the Engagement (Job Task Domain 2), Analyzing and Evaluating the Client's Current Financial Status (Job Task Domain 3), Developing and Communicating the Recommendations (Job Task Domains 4 & 5), Implementing the Recommendations (Job Task Domain 6), Monitoring the Recommendations (Job Task Domain 7), 1.) Hold community, village or town meetings — Identify key problems and issues 3. 2.) Monitor the financial planning recommendations. A person is usually in this phase from approximately 45 to 60 or immedi- ately preceding the client's planned retirement date, a.) False The financial plan is essentially a chapter or section of a business plan. Family Security: Providing for your family's financial security is an important part of the financial planning process. Between low premiums and high deductibles/low coverage or higher pre- miums with greater coverage (for insurance considerations), the client's assessment of the magnitude of the risks being traded off, the degree to which a client's financial resources can cushion risks, this theory involves clients valuing gains and losses differently and as a result making decisions based on perceived gains rather than perceived losses, assets, liabilities, cash flow, budgeting, and debt, current insurance coverage, retained risks, asset protection, and client liquidity, availability, participation, and coverage levels, asset allocation, investment strategies, types of investments, income, estate, and gift tax issues; current tax strategies; tax compliance status, current retirement plans and strategies, accumulation and distribution planning, documents, estate tax liabilities, asset ownership, beneficiary designations, gifting strategies, business form, employer benefits, succession planning and exit strategy, risk management, divorce/remarriage considerations, nontraditional family planning, charitable planning, dependent adult needs, disabled child needs, and terminal illness planning, Creating client-specific recommendations tailored to meet the goals and objectives. Understanding the Financial Pyramid is an essential part of understanding the financial planning process. B. selection of alternatives. The budget process begins with a thorough understanding of your __________. They are easy to create and the advantages of having a financial plan to follow will completely change your financial life. a.) Passively managed funds designed to mirror the performance of an representative asset class are called __________. Budgets can be prepared conservatively by __________. d. the complexity of relationships among factors. Having the proper insurance coverage and policies in place can provide peace of mind for you and your loved ones.. Investment: A proper financial plan considers your personal circumstances, objectives and risk tolerance. Their strategy is an example of __________. Planning is the process of _____ and _____. Online Quiz #1: Chapter 1 — Understanding the Financial Planning Process ACE 240 Online MULTIPLE CHOICE: CHOOSE THE BEST ANSWER 1. 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