AFC - Accredited Financial Counselor Retirement and Estate Planning Questions and Answers

Question 1

A client, age 62, plans to retire soon and is concerned about outliving their savings.
They have a 401(k) and a separate brokerage account.
As an AFC, which of the following topics is MOST crucial to discuss to address their primary concern?

Accepted Answer

Annuity options and systematic withdrawal plans.

Answer

Advanced estate tax minimization strategies.

Answer

The process of naming a guardian for their adult children.

Answer

Aggressive growth stock investment options for their brokerage account.

Question 2

Which of the following legal documents allows an individual to appoint a trusted person to make financial decisions on their behalf if they become incapacitated?

Accepted Answer

A durable power of attorney.

Answer

A living will.

Answer

A last will and testament.

Answer

An irrevocable trust.

Question 3

A 45-year-old client wants to start saving for retirement but is unsure which account to use. Their employer offers a 401(k) with a 50% match on contributions up to 6% of their salary. They also qualify to contribute to a Roth IRA. What should be the AFC's initial guidance?

Accepted Answer

Contribute at least 6% to the 401(k), then contribute to the Roth IRA.

Answer

Contribute the maximum amount to the Roth IRA first.

Answer

Split contributions evenly between the 401(k) and the Roth IRA.

Answer

Invest in a taxable brokerage account until they are closer to retirement.

Question 4

The process of administering and distributing a deceased person's assets through the court system is known as:

Accepted Answer

Probate.

Answer

Intestacy.

Answer

Gifting.

Answer

Trusteeship.

Question 5

An AFC is helping a military service member prepare for a deployment. Which estate planning document is NOT primarily focused on managing affairs in case of incapacity or death?

Accepted Answer

Letter of Instruction.

Answer

Durable Power of Attorney.

Answer

Last Will and Testament.

Answer

Living Will (Advance Medical Directive).

Question 6

All of the following are considered non-probate assets EXCEPT:

Accepted Answer

A checking account owned solely by the decedent with no beneficiary designation.

Answer

Assets held in a revocable living trust.

Answer

Life insurance proceeds with a named beneficiary.

Answer

A 401(k) account with a designated beneficiary.

A client, age 62, plans to retire soon and is concerned about outliving their savings.They have a 401(k) and a separate brokerage account.As an AFC, which of the following topics is MOST crucial to discuss to address their primary concern?

A client, age 62, plans to retire soon and is concerned about outliving their savings.
They have a 401(k) and a separate brokerage account.
As an AFC, which of the following topics is MOST crucial to discuss to address their primary concern?