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CSI AFP-Exam-1 Exam Syllabus Topics:

SectionObjectives
Insurance and Risk Management- Life and health insurance fundamentals
- Risk mitigation strategies in financial planning
Retirement Planning- Retirement savings vehicles and planning principles
Financial Planning Foundations- Ethics and professional standards in financial advising
- Financial planning process and client relationship management
Investment Planning- Asset allocation and portfolio basics
- Investment products and risk-return profiles
Taxation Concepts- Personal income tax principles
- Tax-efficient investment strategies

CSI Applied Financial Planning Certification Exam 1 (AFP) Sample Questions:

1. Jelena, age 32, is single and works as a partner in a law firm. She is meeting with her financial planner, May, as she would like to start investing. Her friend John talks about hot sectors in the stock markets and has recently brought up the cannabis sector. She has done some reading about this sector and is willing to experience large decline in her investments. Jelena also mentioned to May that she believes in high long-term returns. What conclusion can May draw based on their discussions about the stock market and Jelena's expectations?

A) Jelena has good investment knowledge but low experience.
B) Jelena has limited investment knowledge but good experience.
C) Jelena has limited Investment knowledge and experience.
D) Jelena has good investment knowledge and experience.


2. Kendrick, age 55, owns a successful small business, ZXC Inc., valued at $800,000. Kendrick has extensive savings outside of the business and would like to pass the company onto his son at some point in the future.
Kendrick expects the business to increase in value $25,000 per year. If Kendrick decides to use an estate freeze to reduce the amount of taxes he will be required to pay, his financial planner should recommend that he implement the estate freeze at which point in relation to gifting the business to his son?

A) Immediately.
B) To take effect at the time of his passing.
C) At the same time as gifting the company.
D) One month prior to gifting the company.


3. Sunil and Shashi are married and both age 45. Each is the personal care Power of Attorney (POA) for the other. They have no children. Shashi would like to revise the personal care POA to ensure that it reflects her medical wishes. How should their financial planner advise Shashi to help her achieve her goal?

A) Appoint an alternate POA for personal care.
B) Utilize a living will.
C) Appoint someone other than Sunil as her POA for personal care.
D) Utilize her last will and testament.


4. Janet's non-registered account holds the funds listed in the following table:

Assuming a marginal tax rate of 45%, what amount of tax payable will Janet incur if she redeems the account to fund the purchase of a new business?

A) $6,750.
B) $4,500.
C) $9,000.
D) $5,625.


5. Barbara, age 50, is meeting with her financial planner, Clark. Barbara has been hired as the Chief Executive Officer of a very successful privately owned business. Her salary will be $200,000 annually, plus a bonus.
Which retirement savings option should Clark recommend for Barbara?

A) A retirement compensation arrangement.
B) An individual pension plan.
C) A defined benefit plan.
D) A deferred profit-sharing plan.


Solutions:

Question # 1
Answer: C
Question # 2
Answer: A
Question # 3
Answer: B
Question # 4
Answer: B
Question # 5
Answer: B

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