Fundamentals Chapter 17 (Special Circumstances)

Question 1

What changes will occur or be necessary regarding the client’s cash flow situation, assets, and liabilities? Have new goals surfaced or do prior goals need to be redefined in light of the new circumstances? Has priority of goals changed in light of the new circumstances?

Answer 1

Fundamentals

Question 2

What additional protection might be needed? Are there any current policies in place that will no longer be needed? Do beneficiary designations need to be changed?

Answer 2

Insurance and Risk Management

Question 3

Has risk tolerance or risk capacity changed? Is there a need to reallocate investment accounts to produce more income or seek greater tax efficiency? Is the current asset allocation appropriate in light of newly defined goals?

Answer 3

Investments

Question 4

What impact does the special circumstance have on income taxation and what changes should be made to ensure tax efficiency?

Answer 4

Income Taxation

Question 5

How does the change in circumstances affect the overall retirement plan and assumptions? Will decisions need to be made regarding existing qualified plans and other retirement assets?

Answer 5

Retirement Plan

Question 6

Which estate planning documents will need to be redrafted? Are there additional estate planning documents needed in light of the new situation? Do beneficiary designations need to be changed? How does the new situation affect the efficiency of transfers in the estate plan? How should assets be titled in light of the new situation?

Answer 6

Estate Plan