The Financial Planning Process Quiz! Trivia

29 Questions | By Monahan | Updated: May 24, 2022 | Attempts: 6341

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The Financial Planning Process Quiz! Trivia - Quiz

A financial plan looks at financial goals and steps taken to achieve them. Let's see what you know about it with the 'The financial planning process trivia quiz' that we've created below. Most people typically have the same long-term financial goals: how to save for a college fund, pay a debt, and plan for retirement. Do you have the same goals or something unique to yourself? This quiz is for everyone interested in creating concrete financial plans. Make sure you obtain your certificate when you are done with the quiz.

Questions and Answers

1.

Which of the following does NOT fall within the scope of financial planning?
- A.
  
  Work History
- B.
  
  Equity Assets
- C.
  
  Cash Reserves and Equivalents
- D.
  
  None of the above
2.

A common type of Insurance that falls within the scope of financial planning is known as property & ______________ insurance.
- A.
  
  Mortgage
- B.
  
  Renters
- C.
  
  Casualty
- D.
  
  Health
3.

As you move through the scope of financial planning from Cash Reserves and Equivalents to Income Assets to Equity Assets to Tangible Assets, what happens?
- A.
  
  Risk increase, return decreases
- B.
  
  Risk and return both increase
- C.
  
  Risk and return both decrease
- D.
  
  Only risk decreases
4.

The purpose of Cash Reserves and Equivalents is to provide a financial cushion for emergencies, repairs, and other ______________ cash needs.
- A.
  
  Expected
- B.
  
  Unexpected
- C.
  
  Large
- D.
  
  Small
5.

The purpose of Income Assets is to provide a way for investors to obtain ______________.
- A.
  
  Market Exposure
- B.
  
  Large Returns
- C.
  
  Income
- D.
  
  Small Returns
6.

Which of the following is an example of an Income Asset?
- A.
  
  Rental Property
- B.
  
  Variable Annuity
- C.
  
  Corporate, Municipal, State & Federal Bonds
- D.
  
  None of the above
7.

The purpose of Equity Assets is to provide a way for investors to achieve ______________.
- A.
  
  Capital Appreciation
- B.
  
  Government Garauntees
- C.
  
  Tax Deductions
- D.
  
  None of the above
8.

Which of the following is NOT an example of an Equity Asset?
- A.
  
  Income Funds
- B.
  
  Mutual Funds
- C.
  
  Variable Annuities
- D.
  
  None of the above
9.

Tangible Assets are ______________ assets.
- A.
  
  Garaunteed
- B.
  
  Tax Advantaged
- C.
  
  Hypothetical
- D.
  
  Fixed
10.

Which of the following is an example of a Tangible Asset?
- A.
  
  Stocks
- B.
  
  Oil & Gas Partnerships
- C.
  
  Corporate, Municipal, State & Federal Bonds
- D.
  
  None of the above
11.

Improving the current standard of living, minimizing income taxes, and protecting the family in case of premature death are all examples of _______ of financial planning.
- A.
  
  Names
- B.
  
  Types
- C.
  
  Goals
- D.
  
  All of the above
12.

A typical goal of financial planning is to pass _________ to surviving family members.
- A.
  
  Debt
- B.
  
  Business interests
- C.
  
  Loans
- D.
  
  None of the above
13.

A typical goal of financial planning is to provide for ____________________ in case of disability.
- A.
  
  Minimum estate taxes
- B.
  
  Legal defense
- C.
  
  Ongoing income
- D.
  
  Ongoing expenses
14.

A typical goal of financial planning is to increase net worth through ________.
- A.
  
  Savings and investments
- B.
  
  Borrowing
- C.
  
  Lottery winnings
- D.
  
  All of them
15.

A typical goal of financial planning is to provide funds for children's _________.
- A.
  
  Amusement
- B.
  
  Education
- C.
  
  Child Care
- D.
  
  All of the above
16.

What is the traditional primary role of a Registered Representative?
- A.
  
  To coordinate various aspects of clients' financial affairs such as investments, insurance and retirement planning.
- B.
  
  To minimize a client's tax burden through the use of credit sheltered trusts.
- C.
  
  To facilitate, or broker, customer transactions in financial products such as stocks, bonds and mutual funds.
- D.
  
  None of the above
17.

What is the traditional primary role of a Financial Planner?
- A.
  
  To coordinate various aspects of clients' financial affairs such as investments, insurance and retirement planning.
- B.
  
  To minimize a client's tax burden through the use of credit sheltered trusts.
- C.
  
  To facilitate, or broker, customer transactions in financial products such as stocks, bonds and mutual funds.
- D.
  
  None of the above
18.

What is required for a person to call themselves a financial planner and charge a fee for service?
- A.
  
  A Series 7 liscense
- B.
  
  A Certified Financial Planner (CFP) designation
- C.
  
  Nothing
- D.
  
  All of the above
19.

How are registered representatives compensated?
- A.
  
  By charging a fee on a percentage of assets managed
- B.
  
  With an up front fee
- C.
  
  By charging a commission on products and services sold
- D.
  
  They're not compensated
20.

A Financial Planner may avoid requesting a copy of a client's tax return to avoid what?
- A.
  
  Charging an unneccessary fee
- B.
  
  Giving tax advice
- C.
  
  Unneccessary work
- D.
  
  Unnecessary taxes
21.

During the Information Gathering & Goal Setting step in the financial planning process, the Financial Planner ____________________.
- A.
  
  Reviews Assets, Liabilities, Current and Projected Income, Insurance Coverage and Investments
- B.
  
  Recommends short and long term investment strategies
- C.
  
  Gathers Quantitative and Qualitative information
- D.
  
  All of them
22.

During the Evaluation step in the financial planning process, the Financial Planner provides an overview of services provided and _________________.
- A.
  
  Details fees for services
- B.
  
  Outlines investment opportunities
- C.
  
  Recommends stocks
- D.
  
  Invested stocks
23.

A client's financial Action Plan should include what?
- A.
  
  A negotiation of fees
- B.
  
  Time frames and responsibility assignments
- C.
  
  Tentative observations and preliminary recommendations
- D.
  
  None of the above
24.

During the Information Analysis & Plan Development step in the financial planning process, the Financial Planner __________________.
- A.
  
  Reviews legal documents
- B.
  
  Presents the action plan
- C.
  
  Monitors the plan
- D.
  
  Audits the financial documents
25.

Choose an action that is NOT included in the plan implementation step in the financial planning process?
- A.
  
  Goal Revision
- B.
  
  Changes in spending and saving habits
- C.
  
  Adoption of legal instruments
- D.
  
  None of the above