KNOWLEDGE EXPECTED OF: Both CFP® Professionals and QAFPTM Professionals
- Identify factors that influence the pension benefit amount for a specified pension plan member, such as:
- Amount of money contributed to the account
- Length of investment time horizon
- Earnings on the amount invested
- Calculate the projected pension benefit for a specified pension plan member.
- Explain the pension benefit options that may be available to a specified pension plan member.
- Explain the tax impact of withdrawing and receiving a benefit from a specified pension plan.
- Estimate the tax impact of withdrawing and receiving a benefit from a specified pension plan.
- Explain how each of the factors may impact the suitability of withdrawing from a specified pension plan, such as:
- Risk tolerance
- Effect on current cash flow
- Effect on future cash flow (impact on value of future pension benefit)
- Effect on current net worth
- Effect on future net worth
- Fiscal discipline of individual
- Psychological impact from decision
- Impact on pension adjustment
- Expected tax rate at time of receipt of pension benefit
- Impact of future receipt of pension benefits on government benefits
- Evaluate how each of the factors may impact the suitability of withdrawing from a specified pension plan.
Glossary of Verbs (mouse over to see definition)
To state exactly the meaning of
To be aware of / to recognize and correctly name / to locate an appropriate resource
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
To note the similarities and differences between two or more things
To determine an approximate value for
To find the value using mathematics
To change from one form or purpose to another
To reach a conclusion or make a judgement through careful study
To give the meaning of / to construe or understand / to translate orally