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29 Cards in this Set
- Front
- Back
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Financial needs for a school age Young people |
Somewhere to save pocket money - building society accounts, junior ISA, friendly society bond. |
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Financial needs for teenagers and students? |
Somewhere to put your earnings for a part-time job, borrowing to buy a car or borrowing to fund education. Bank current account, personal or student loan & overdraft facility. |
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Financial needs for post-education young people? |
Saving for deposit for a house. Protection against loss of income due to illness. Loan to buy house. Building society account , mortgage |
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Financial needs for young families? |
Protection against loss of income due to illness. Life cover protection for dependence. Bigger house. Provision for retirement. IPI, life assurance, bigger mortgage, pension, |
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Financial needs for established families? |
Planning for retirement. Protection against loss of income. Life cover protection for children. Savings and investment over the long term. Increased pension contributions, life assurance, savings & investment products. |
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Financial needs for mature households? |
Planning for retirement. Savings and investment over the medium term to be accessible for retirement. Increased pension contributions, savings and investment products |
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Financial needs for Retirement? |
Creating as much income as possible from pension plans and saving policies. Releasing capital from property. Possible long-term care. Investments that provide income, equity release, long-term care annuities. |
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What are the five areas of financial need? |
-Protecting dependence from financial affect of either loss of income or premature death. - protect himself and dependence from losing the ability to earn income in the long term. - providing an income in retirement. - wanting to increase or protect the value of money saved to invested. -saving Tax |
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What is a priority need for a client taking out the first mortgage? |
Income protection |
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Why is it important to establish a client's place of birth as part of their fact find? |
It is important to establish a client 's domicile for tax purposes and it may be a factor in underwriting decisions. |
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What is a priority for a client who has surplus cash for the first time? |
An Emergency fund |
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When completing a fact find for a client in relation to investment advice, what should be taken into consideration? |
The client's attitude to risk |
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What is the highest financial priority for a retired couple? |
Generating income. |
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What is meant by 'capacity for loss'? Why is it important? |
The extent to which the client would be adversely affected should they make a loss and their investment. This must be taken into account when assessing attitude to risk |
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Lets factors that an advisor might take into consideration when deciding on an appropriate solution for a client? |
Eligibility for state benefit; exist in arrangements; affordability; taxation; attitude to risk; capacity for loss; anticipated changes in circumstances; time scale; flexibility? |
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List five points I should be included when presenting a recommendation to a client? |
-The purpose of the project and the needs it will address. - The benefits to the client. - risks and limitations of the product. - Any product options that might be appropriate. - summary of reasons for recommending that product. |
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How long must records relating to pension transfers be retained? |
Indefinitely |
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What is the difference between proactive and reactive servicing? |
Proactive services instigated by the advisor. Reactive servicing is instigated by the client to address a need |
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What is the Nil Rate band? |
The nail red band is a specific amount of money that can be passed onto your beneficiaries when you die without them having to pay inheritance tax. The current Nil rate band amount in UK £325,000 |
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What type of life assurance policy is generally used for IHT purposes? |
A life insurance policy that is often used for IHT purposes is a whole of life assurance policy. This type of policy provides a guaranteed death benefit and covers the policy holder for the entire life, as long as premiums are paid. Hall of Life policies can be expensive, so it's important to be careful, Consider your options and seek professional advice. |
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Client to expect the exceed their capital gains tax annual exempt amount may what? |
Consider investments that are CGT free such as Gilts. |
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What main factors affect the calculation of the level of sickness cover needed by a working parent with children? |
The extent of any sickness benefit from an employer. The nature and amount of available state benefit. The number and ages of the children and availability of any help from family and friends with childcare and housekeeping |
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What is the purpose of a key person insurance? |
To mitigate adverse impact on a business is profits caused by the death or long terminal, less of an important member of staff |
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How does the cross option method differ from the buy and sell method of partnership protection? |
When a partner in a business days, the other partner has a choice to buy the deed partners part of the business instead of receiving money. Because of this, the business can apply for a tax break called " business relief" from inheritance tax |
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What repayment vehicle would be suitable for a client who wants an interest only mortgage but insists that the product must guarantee to pay off the mortgage at the end of the term? |
Full with profits endowment. Is set at the level equal to the mortgage debt so, as long as payment is maintained, it will guarantee to repay the mortgage at the end of the term. |
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What rule does HMRC apply in relation to gifts with reservation? |
If a donor receives any benefit from a gifted asset, the asset is treated for inherence tax purposes has remaining on the donors estate |
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It is important to ensure that the customer agrees with the advisor's assessment of their priorities. True or false? |
False. Deciding they plan of action and agree and it's a proud. The order is the customer's decision, assisted by input from the advisor. |
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The FCA prescribes the format of the fact finding the information required? True or false |
False |
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Which product must a firm keep records of the advice given indefinitely? |
Pension opt-outs. |
