Overview

Certified Financial PlannerCFP is a formal recognition of expertise in the areas of financial planning, taxes, insurance, estate planning, and retirement saving.Owned and awarded by the Certified Financial Planner Board of Standards, Inc., the designation is awarded to individuals who successfully complete the CFP Board's initial exams, then continue ongoing annual education programs to sustain their skills and certification.CFPs are there to help individuals manage their finances. This can include a variety of needs, such as investment planning, retirement planning, insurance, and education planning. The most important aspect of a CFP® is to be a fiduciary of your assets, meaning that they will make decisions with your best interests in mind.CFPs are all-encompassing, particularly when compared to investment advisors. CFPs will usually start the process by evaluating your current finances, including any cash, assets, investments, or properties, to come up with an estimate of your income and net worth. They also take a look at your liabilities, such as mortgages and student debt.CFP Exam OutlineThe CFP exam contains 170 multiple-choice questions and has a time limit of 6 hours (split into two 3-hour sections).The exam is split into eight content domains, and each question will either be a standalone question or a scenario-based question.1. Professional Conduct and Regulation (8%)The questions in this domain cover the following topics:The function, general structure, and purpose of financial institutionsFiduciary standard and applicationCFP Board's Procedural RulesConsumer protection lawsCFP Board's Code of Ethics and standards of ConductFinancial services requirements and regulations2. General Principles of Financial Planning (15%)The questions in this domain cover the following topics:Economic conceptsCash flow managementIncome tax strategiesFinancial planning processTime value of money concepts and calculationsEducation fundingFinancial statementsEducation needs analysisFinancing strategiesDebt management3. Risk Management and Insurance Planning (11%)The questions in this domain cover the following topics:Disability income insuranceAnalysis and evaluation of risk exposuresInsurance needs analysisLong-term care insurancePrinciples of risk and insuranceQualified and non-qualified annuitiesInsurance policy and company selectionHeatlh care cost managementLong-term case planningBusiness owner insurance solutionsLife insuranceInsurance needs analysis4. Investment Planning (17%)The questions in this domain cover the following topics:Market cyclesAlternative investments and liquidity riskAsset allocation and portfolio diversificationTypes of investment riskInvestment strategiesCharacteristics, taxation, and uses of investment vehiclesQuantitative investment concepts and measures of investment returnsBond and stock valuation concepts5. Tax Planning (14%)The questions in this domain cover the following topics:Current and fundamental tax lawIncome taxation of estates and trustsCharitable contributions and deductionsTax reduction techniquesTax implications of special circumstancesCharacteristics and income taxation of business entitiesTax consequences of property transactionsTax management techniquesIncome tax fundamentals and calculations6. Retirement Savings and Income Planning (18%)The questions in this domain cover the following topics:Business succession planningEldercare and special needs planningKey factors affecting plan selection for businessesDistribution rules and taxationSocial Security and Medicare planningQualified and non-qualified plan rules and optionsRetirement needs analysisRetirement income and distribution strategiesTypes of retirement plans7. Estate Planning (10%)The questions in this domain cover the following topics:Marital deductionStrategies to transfer propertySources for estate liquidityProperty titling and beneficiary designationsPlanning for special needs and circumstancesIntra-family and other business transfer techniquesEstate and incapacity planning documentsPlanning for divorce, unmarried couples, and other special circumstancesPostmortem estate planning techniquesEstate, gift, and GST tax compliance and calculation8. Psychology of Financial Planning (7%)The questions in this domain cover the following topics:Principles of counselingCrisis events with severe consequencesClient and planner biases, attitudes, and valuesSources of money conflictGeneral principles of effective communicationPrinciples of counselingBehavioral finance

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