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Financial Planning Competency Handbook, 2nd Edition (International Edition)

Hardcover

$175.00

Financial Planning Competency Handbook, 2nd Edition (International Edition)

CFP Board

ISBN: 978-1-119-09466-1 August 2015 944 Pages

Description

The official guide for exam success and career excellence

Financial Planning Competency Handbook, Second Edition is the essential reference for those at any stage of certification and a one-stop resource for practitioners looking to better serve their clients. This fully updated second edition includes brand new content on connections diagrams, new case studies, and new instructional videos, and a completely new section devoted to the interdisciplinary nature of financial planning. You'll gain insights from diverse fields like psychology, behavioral finance, communication, and marriage and family therapy to help you better connect with and guide your clients, alongside the detailed financial knowledge you need to perform to the highest expectations as a financial planner. This book contains over ninety chapters that are essential for practitioners, students, and faculty.

Whether a practitioner, student, or faculty member, this guide is the invaluable reference you need at your fingertips. Comprehensive, clear, and detailed, this handbook forms the foundation of the smart financial planner's library.

Each jurisdiction has its own laws and regulations surrounding financial planning, but the information in this book represents the core body of knowledge the profession demands no matter where you practice. Financial Planning Competency Handbook, Second Edition guides you from student to practitioner and far beyond, with the information you need when you need it.

Acknowledgments xiii

About the Book xv

Preface xvii
Charles R. Chaffin, EdD, CFP Board

About the Practice Questions xxiii

About the Contributors xxv

Part One Introduction 1
Charles R. Chaffin, EdD, CFP Board

1 Theory and Practice 5
Charles R. Chaffin, EdD, CFP Board

2 Function, Purpose, and Regulation of Financial Institutions 15
John E. Grable, PhD, CFP®, University of Georgia
Sonya L. Britt, PhD, CFP®, Kansas State University

3 Financial Services Regulations and Requirements 25
John E. Grable, PhD, CFP®, University of Georgia
Sonya L. Britt, PhD, CFP®, Kansas State University

4 Consumer Protection Laws 35
John E. Grable, PhD, CFP®, University of Georgia
Sonya L. Britt, PhD, CFP®, Kansas State University

5 Fiduciary 45
Martie Gillen, PhD, University of Florida

6 Financial Planning Process 51
John E. Grable, PhD, CFP®, University of Georgia
Ronald A. Sages, PhD, AEP®, CFP®, CTFA, EA, Kansas State University

7 Financial Statements 63
Thomas Warschauer, PhD, CFP®, San Diego State University

8 Cash Flow Management 73
Martie Gillen, PhD, University of Florida
Michael Gutter, PhD, University of Florida

9 Financing Strategies 81
Martie Gillen, PhD, University of Florida
Michael Gutter, PhD, University of Florida
Jorge Ruiz-Menjivar, University of Georgia

10 Economic Concepts 89
Dave Yeske, DBA, CFP®, Golden Gate University

11 Time Value of Money 97
Jorge Ruiz-Menjivar, University of Georgia
Martie Gillen, PhD, University of Florida
Michael Gutter, PhD, University of Florida

12 Client and Planner Attitudes, Values, Biases, and Behavioral Finance 107
Dave Yeske, DBA, CFP®, Golden Gate University

13 Principles of Communication and Counseling 115
John E. Grable, PhD, CFP®, University of Georgia
Kristy L. Archuleta, PhD, LMFT, Kansas State University

14 Debt Management 127
Joseph W. Goetz, PhD, University of Georgia
John E. Grable, PhD, CFP®, University of Georgia

15 Education Needs Analysis 137
Taylor Spangler, MS, University of Florida
Michael Gutter, PhD, University of Florida
Martie Gillen, PhD, University of Florida
Sailesh Acharya, University of Florida

16 Education Savings Vehicles 145
Michael Gutter, PhD, University of Florida
Martie Gillen, PhD, University of Florida

17 Financial Aid (Education) 153
Martie Gillen, PhD, University of Florida
Michael Gutter, PhD, University of Florida

18 Gift and Income Tax Strategies (Education) 159
Martie Gillen, PhD, University of Florida
Michael Gutter, PhD, University of Florida

19 Education Financing 165
Martie Gillen, PhD, University of Florida
Michael Gutter, PhD, University of Florida

20 Principles of Risk and Insurance 173
Dave Yeske, DBA, CFP®, Golden Gate University

21 Analysis and Evaluation of Risk Exposures 183
Dave Yeske, DBA, CFP®, Golden Gate University

22 Health Insurance and Health Care Cost Management 189
Andrew Head, MA, CFP®, Western Kentucky University
Sharon A. Burns, PhD, CPA (Inactive)

23 Disability Income Insurance (Individual) 197
Dave Yeske, DBA, CFP®, Golden Gate University

24 Long-Term Care Insurance 205
Andrew Head, MA, CFP®, Western Kentucky University
Sharon A. Burns, PhD, CPA (Inactive)

25 Annuities 213
Andrew Head, MA, CFP®, Western Kentucky University
John Gilliam, PhD, CFP®, Texas Tech University

26 Life Insurance (Individual) 225
Dave Yeske, DBA, CFP®, Golden Gate University

27 Business Uses of Insurance 233
L. Ann Coulson, PhD, CFP®, Kansas State University
John Gilliam, PhD, CFP®, Texas Tech University

28 Insurance Needs Analysis 245
Thomas Warschauer, PhD, CFP®, San Diego State University

29 Insurance Policy and Company Selection 253
Thomas Warschauer, PhD, CFP®, San Diego State University
Andrew Head, MA, CFP®, Western Kentucky University

30 Property and Casualty Insurance 263
Derek R. Lawson, MS, Sonas Financial Group, Inc. and Kansas State University
Sarah D. Asebedo, MS, CFP®, Virginia Tech
Martin C. Seay, PhD, CFP®, Kansas State University

31 Characteristics, Uses, and Taxation of Investment Vehicles 275
Swarn Chatterjee, PhD, University of Georgia
Lance Palmer, PhD, CPA, CFP®, University of Georgia

32 Types of Investment Risk 283
Thomas Warschauer, PhD, CFP®, San Diego State University

33 Quantitative Investment Concepts 291
Thomas Warschauer, PhD, CFP®, San Diego State University

34 Measures of Investment Returns 299
Thomas Warschauer, PhD, CFP®, San Diego State University

35 Asset Allocation and Portfolio Diversification 307
Dave Yeske, DBA, CFP®, Golden Gate University

36 Bond and Stock Valuation Concepts 315
Dave Yeske, DBA, CFP®, Golden Gate University

37 Portfolio Development and Analysis 325
Thomas Warschauer, PhD, CFP®, San Diego State University

38 Investment Strategies 335
Dave Yeske, DBA, CFP®, Golden Gate University

39 Alternative Investments 343
L. Michael Ladd, CFA, CAIA, CMT, CFP®

40 Fundamental Tax Law 353
Lance Palmer, PhD, CPA, CFP®, University of Georgia

41 Income Tax Fundamentals and Calculations 363
Lance Palmer, PhD, CPA, CFP®, University of Georgia

42 Characteristics and Income Taxation of Business Entities 373
Webster Hewitt, CPA, CFP®, University of Georgia
Lance Palmer, PhD, CPA, CFP®, University of Georgia

43 Income Taxation of Trusts and Estates 383
Martin C. Seay, PhD, CFP®, Kansas State University
Lance Palmer, PhD, CPA, CFP®, University of Georgia

44 Alternative Minimum Tax (AMT) 391
Webster Hewitt, CPA, CFP®, University of Georgia
Lance Palmer, PhD, CPA, CFP®, University of Georgia

45 Tax Reduction and Management Techniques 399
Lance Palmer, PhD, CPA, CFP®, University of Georgia

46 Tax Consequences of Property Transactions 409
Lance Palmer, PhD, CPA, CFP®, University of Georgia
Martin C. Seay, PhD, CFP®, Kansas State University

47 Passive Activity and At-Risk Rules 417
Lance Palmer, PhD, CPA, CFP®, University of Georgia

48 T ax Implications of Special Circumstances 423
Lance Palmer, PhD, CPA, CFP®, University of Georgia

49 Charitable/Philanthropic Contributions and Deductions 431
Webster Hewitt, CPA, CFP®, University of Georgia
Lance Palmer, PhD, CPA, CFP®, University of Georgia

50 Retirement Needs Analysis 439
Andrew Head, MA, CFP®, Western Kentucky University
Sharon A. Burns, PhD, CPA (Inactive)

51 Social Security and Medicare 447
Sarah D. Asebedo, MS, CFP®, Virginia Tech
Martin C. Seay, PhD, CFP®, Kansas State University
Thomas Warschauer, PhD, CFP®, San Diego State University

52 Medicaid 463
Katie Seay, CFP®, The Trust Company
Martin C. Seay, PhD, CFP®, Kansas State University

53 Types of Retirement Plans 471
John E. Grable, PhD, CFP®, University of Georgia

54 Qualified Plan Rules and Options 479
Andrew Head, MA, CFP®, Western Kentucky University
Sharon A. Burns, PhD, CPA (Inactive)

55 Other Tax-Advantaged Plans 485
Andrew Head, MA, CFP®, Western Kentucky University
Sharon A. Burns, PhD, CPA (Inactive)

56 Regulatory Considerations 491
Andrew Head, MA, CFP®, Western Kentucky University
Sharon A. Burns, PhD, CPA (Inactive)

57 Key Factors Affecting Plan Selection for Businesses 495
Andrew Head, MA, CFP®, Western Kentucky University
Sharon A. Burns, PhD, CPA (Inactive)

58 Distribution Rules and Taxation 501
Andrew Head, MA, CFP®, Western Kentucky University
Sharon A. Burns, PhD, CPA (Inactive)

59 Retirement Income and Distribution Strategies 509
Dave Yeske, DBA, CFP®, Golden Gate University
Elissa Buie, MBA, CFP®, Golden Gate University

60 Business Succession Planning 515
John E. Grable, PhD, CFP®, University of Georgia
Joseph W. Goetz, PhD, University of Georgia
Kevin Valentino, MS, University of Georgia

61 Characteristics and Consequences of Property Titling 527
Andrew Head, MA, CFP®, Western Kentucky University
Sharon A. Burns, PhD, CPA (Inactive)

62 Gifting Strategies 533
Elissa Buie, MBA, CFP®, Golden Gate University

63 Estate Planning Documents 541
Andrew Head, MA, CFP®, Western Kentucky University
Sharon A. Burns, PhD, CPA (Inactive)

64 Estate Tax Compliance and Tax Calculation 547
Elissa Buie, MBA, CFP®, Golden Gate University

65 Sources for Estate Liquidity 555
Elissa Buie, MBA, CFP®, Golden Gate University

66 T ypes, Features, and Taxation of Trusts 561
Elissa Buie, MBA, CFP®, Golden Gate University

67 Marital Deduction 569
Elissa Buie, MBA, CFP®, Golden Gate University

68 Intra-Family and Other Business Transfer Techniques 575
Elissa Buie, MBA, CFP®, Golden Gate University

69 Postmortem Estate Planning Techniques 585
Elissa Buie, MBA, CFP®, Golden Gate University

70 Estate Planning for Non-Traditional Relationships 591
Elissa Buie, MBA, CFP®, Golden Gate University

Supplement: CFP Board’s Code of Ethics and Professional Responsibility 601

Part Two Introduction 605
Charles R. Chaffin, EdD, CFP Board
Thomas Warschauer, PhD, CFP®, San Diego State University

71 Establishing and Defining the Client-Planner Relationship 609
Elissa Buie, MBA, CFP®, Golden Gate University
Dave Yeske, DBA, CFP®, Golden Gate University

72 Gathering Information Necessary to Fulfill the Engagement 617
Elissa Buie, MBA, CFP®, Golden Gate University
Dave Yeske, DBA, CFP®, Golden Gate University

73 Analyzing and Evaluating the Client’s Current Financial Status 625
Thomas Warschauer, PhD, CFP®, San Diego State University
Vickie Hampton, PhD, CFP®, Texas Tech University
Andrew Head, MA, CFP®, Western Kentucky University

74 Developing Financial Planning Recommendations 635
John E. Grable, PhD, CFP®, University of Georgia
Lance Palmer, PhD, CPA, CFP®, University of Georgia

75 Communicating the Financial Planning Recommendations 653
Dave Yeske, DBA, CFP®, Golden Gate University
John E. Grable, PhD, CFP®, University of Georgia

76 Implementing the Financial Planning Recommendations 665
Ronald A. Sages, PhD, AEP®, CFP®, CTFA, EA, Kansas State University

77 Monitoring the Financial Planning Recommendations 677
Thomas Warschauer, PhD, CFP®, San Diego State University
Sharon A. Burns, PhD, CPA (Inactive)

Part Three Introduction 685
Charles R. Chaffin, EdD, CFP Board

78 Gathering Data from Clients: Insights from Cognitive Task Analysis and Requirements Engineering 687
Kelly S. Steelman, PhD, Michigan Technological University
Jason S. McCarley, PhD, Flinders University
John E. Grable, PhD, CFP®, University of Georgia
Lance Palmer, PhD, CPA, CFP®, University of Georgia
Dave Yeske, DBA, CFP®, Golden Gate University
Charles R. Chaffin, EdD, CFP Board

79 The Need for Education 703
Joyce Schnur, CFP®, MBA, ChFC, Kaplan University
Charles R. Chaffin, EdD, CFP Board

80 Financial Planning Standards Board 709
Michael Snowdon, CFP®, Financial Planning Standards Board

81 Behavioral Finance and Its Implications for Financial Advisors 737
Keith Redhead, PhD, Coventry University

82 Applications of Behavioral Economics in Personal Financial Planning 751
Swarn Chatterjee, PhD, University of Georgia
Joseph W. Goetz, PhD, University of Georgia

83 Marriage and Family Therapy Applications to Financial Planning 763
Kristy L. Archuleta, PhD, LMFT, Kansas State University
D. Bruce Ross III, MS, University of Georgia

84 Financial Therapy: The Integration of Financial Planning and Theory 779
Kristy L. Archuleta, PhD, LMFT, Kansas State University
Bradley T. Klontz, PsyD, CFP®, Kansas State University
Sonya L. Britt, PhD, CFP®, Kansas State University

85 Aging Clients: Special Considerations 795
Deanna L. Sharpe, PhD, CFP®, University of Missouri

86 Accounting for Time: Important Distinctions and Concepts for Financial Planners 829
John E. Grable, PhD, CFP®, University of Georgia
Robert Rodermund, MS, Lindenwood University

87 The Psychology of Decisions: A Short Tutorial 843
Jason S. McCarley, PhD, Flinders University
Kelly S. Steelman, PhD, Michigan Technological University
John E. Grable, PhD, CFP®, University of Georgia
Lance Palmer, PhD, CPA, CFP®, University of Georgia
Dave Yeske, DBA, CFP®, Golden Gate University
Charles R. Chaffin, EdD, CFP Board

88 Moving Forward 861
Charles R. Chaffin, EdD, CFP Board
Elissa Buie, MBA, CFP®, Golden Gate University
Sharon A. Burns, PhD, CPA (Inactive)
Vickie Hampton, PhD, CFP®, Texas Tech University
Lance Palmer, PhD, CPA, CFP®, University of Georgia
Thomas Warschauer, PhD, CFP®, San Diego State University
Dave Yeske, DBA, CFP®, Golden Gate University

Index 879

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