CFP Cheat Sheet 2026

The 30 highest-yield CFP facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. Under per stirpes distribution, if a beneficiary predeceases the testator, the deceased beneficiary's share passes to: → The deceased beneficiary's own descendants by representation
2. When in the business cycle do demand and hiring start to slow down, while inflation is trending up and unemployment is still declining but more slowly? → Peak phase
3. Which type of trust allows the grantor to retain full control during their lifetime and avoids probate at death? → Revocable living trust
4. What is the benefit of interdisciplinary collaboration in Certified Financial Planner practice? → It brings diverse expertise and perspectives that improve outcomes and innovation
5. A client wants to retire at age 62. Which Social Security strategy should they consider regarding claiming benefits? → Wait until full retirement age (FRA) or later to maximize monthly benefit
6. What role does peer review play in Certified Financial Planner practice? → It provides quality assurance and professional development through collegial evaluation
7. What is the 'step-up in basis' rule as applied to inherited assets? → The asset's cost basis is reset to its fair market value at the decedent's date of death
8. When converting a traditional IRA to a Roth IRA, how is the converted amount taxed? → It is taxed as ordinary income in the year of conversion
9. What is the primary value of case study analysis in Certified Financial Planner training? → Developing critical thinking by applying theory to realistic professional scenarios
10. Which of the following assets passes outside of probate by operation of law? → A bank account held as joint tenancy with right of survivorship
11. What is the federal estate tax exemption amount per individual in 2024? → $13.61 million
12. What is 'basis' in the context of capital gains taxation? → The original cost of an asset, adjusted for improvements, depreciation, and other factors
13. Portability in estate planning refers to: → A surviving spouse's ability to use a deceased spouse's unused estate tax exemption
14. Which of the following is NOT a tax-advantaged education savings vehicle? → UGMA/UTMA Custodial Account
15. What is the first step in risk assessment for Certified Financial Planner professionals? → Identifying potential hazards and vulnerabilities in the specific context
16. Why is documentation important in CFP risk management? → It creates an audit trail, supports decision-making, and demonstrates due diligence
17. What is the catch-up contribution limit for a 401(k) for individuals aged 50 and older in 2024? → $7,500
18. A 55-year-old client leaves their employer and wants to access 401(k) funds without penalty. Which rule allows this? → Rule of 55
19. For a married couple filing jointly in 2024, at what income level does the Net Investment Income Tax (NIIT) of 3.8% begin to apply? → $250,000
20. What is the annual gift tax exclusion amount per recipient in 2024? → $18,000
21. What is the efficient market hypothesis (EMH) and which form suggests that technical analysis cannot consistently produce excess returns? → Weak form, which holds that past price and volume data cannot predict future prices
22. How does a CFP professional communicate risks to stakeholders? → By presenting risks clearly with context, potential impacts, and recommended actions
23. How should an CFP professional handle a situation outside their scope of competency? → Recognize limitations and refer to or consult with appropriate specialists
24. Which of the following best describes dollar-cost averaging (DCA)? → Investing a fixed dollar amount at regular intervals regardless of market price
25. What is 'tax-loss harvesting' in the context of investment planning? → Selling investments at a loss to offset capital gains and reduce tax liability
26. What role does active listening play in Certified Financial Planner practice? → It ensures accurate understanding, demonstrates respect, and improves outcomes
27. Which fiduciary standard requires a financial advisor to act in the best interest of the client at all times, putting the client's interests ahead of their own? → Fiduciary standard
28. Which document authorizes an individual to make healthcare decisions on behalf of an incapacitated person? → Healthcare proxy (durable power of attorney for healthcare)
29. Which estate planning technique allows a parent to superfund a 529 plan by front-loading up to five years' worth of annual exclusion gifts? → 5-year gift averaging (superfunding)
30. A client receives a lump-sum distribution from a pension plan. What is the deadline for completing a rollover to an IRA to avoid taxes and penalties? → 60 days