CF5 Advice

DM18

Hi,

There seems to be a few threads about people seeking advice about CFP exams so i thought id give it a whirl...

I was wondering if anyone has recently completed the above and had any revision tips that they would be kind enough to share. I only ask as i am not currently working in the industry and have no one to discuss revision plans/ask advice.

Thanks for your help!

dunstonh

I havent set CF5 ever but the CII study material is very good and as long as you have that, you should be ok if you spend the time learning it. There shouldnt be anything in the exams which is not in the study material. So you can almost exclusively work to that.

Aegis

If CF5 is anything like CeFA 4 (both test the same material, so I'd be surprised if the format varied wildly between the two) then essentially this paper will simply be a matter of applying the knowledge from the other units to scenarios. If you get the case studies in advance, it might be worth running through all of them and identifying the type of product that would be suitable for dealing with the various needs demonstrated, then learn the peripheral material around that. That way when the scenario comes up, the questions will likely already have been answered.

That's what I'm hoping anyway!

DM18

Thanks guys! from what i can gather, the best approach seems to study as many case studies as possible to familiarise myself with the structure of the answers.
as a refresher i think i will read the key points from the previous 4 modules.
Aegis - when do you sit yours? ive given myself 4 weeks study time for this one, how about you?

thanks again guys!

Lokolo

Aegis wrote: »

If CF5 is anything like CeFA 4 (both test the same material, so I'd be surprised if the format varied wildly between the two) then essentially this paper will simply be a matter of applying the knowledge from the other units to scenarios. If you get the case studies in advance, it might be worth running through all of them and identifying the type of product that would be suitable for dealing with the various needs demonstrated, then learn the peripheral material around that. That way when the scenario comes up, the questions will likely already have been answered.

That's what I'm hoping anyway!

When are you going to do your final exam anyway?

Aegis

Lokolo wrote: »

When are you going to do your final exam anyway?

No idea... The exams don't end with CeFA. However, my final CeFA exam is on the 11th of next month, so with any luck I will get those extra letters after my name before too long

psbrett

I just took mine and passed first time via self study route. All I will say is study the 16 or so case studies and familiarise yourself with the answering techniques. Especially as 40% or so of marks are based on the investment portfolio.
Martin Lewis produced a guide on Child Trust funds which was invaluable to me and must of earned me 9/10 marks.This was something not heavily covered in the previous modules so be on your toes. All exams are different so just make sure all bases are covered.
Good luck in the exam.

Brum_Man

Yep, CF5 is nothing like Cefa 4. I personally think it's much more testing and broad. As said above, really concentrate on the second half of the paper where you need to design an investment portfolio, get used to designing income portfolios with about £300k and coming up with good 3 point justifications for each recommendation.

If you can nail that you already have about 30%-40% of the marks and then you should be able to pick up the rest throughout the rest of the paper where you are just tested on your basic product knowledge of investments/pensions/life products.

TH1878

I've recently passed my CF5 exam - question 1 usually takes care of itself, probably a question on Protection products etc but pay attention to the tax treatment (e.g Income Protection - No tax relief on premiums, but benefits are tax free). Revise the main products (I didn't do Child Trust Funds and it came back to bite me!):

Income Protection
Term Assurance & Critical Illness Cover
Family Income Benefit
ASU / MPPI
Whole of Life Cover (unit linked and WP)
Personal/Stakeholder Pensions
AVCs
Final Salary Pension Schemes
OEICs / Unit Trusts v Life Assurance Bonds
Investment Trusts
National Savings Products
Child Trust Funds
Futures, Options, Warrants
Maxi / Mini ISAs (assuming you're taking exam before 31/08)

(They're just the ones of the top of my head)

You need to be able to justify things like the term (e.g Income Protection to retirement age). You may need to compare two products (ASU v Income Protection for example) so have a good working knowledge of each. Also on question 1, familiarise yourself with questions you could ask the client like "Have you made a will..."

Question 2 (building a portfolio) is more challenging - practice as much as you can so you're not wasting time in the exam. Make sure you familiarise yourself with the panel of products available and don't go overboard on the number of products you use. It's also useful to know which products you should use to provide an income (gilts etc) as this can form quite a large part of the exam. One of the most important things is how you lay them out.

When justifying each product, I just split them down into the generic product. For example, rather than justifying 2 bank accounts, I grouped them together as one:

e.g - Justify the following (bank accounts)

Amount = Equivalent to 3 months net pay
Risk = Low Risk / Secure Investment
Justification = Instant Access - provides liquidity

ISAs

Amount = Maximum Limit for Tax Year
Risk = Dependent on fund choice
Justification = Income & Capital Tax free

Pension:

Amount = Within maximum permitted limits for obtaining tax relief
Risk = As per fund choice
Justification = Tax relief on contributions & Tax free cash at retirement.

Don't generalise the answers, e.g ISAs are tax-efficient, make sure you explain how they are tax efficient etc.

If there's anything else I can help with, just PM me.

Good luck!

TH1878

dunstonh wrote: »

I havent set CF5 ever but the CII study material is very good and as long as you have that, you should be ok if you spend the time learning it. There shouldnt be anything in the exams which is not in the study material. So you can almost exclusively work to that.

Actually for CF5, the folder they give you is virtually useless. The case studies book (available for an extra £60-70 quid - rip off merchants!) is much more useful though.

TH1878

Aegis wrote: »

No idea... The exams don't end with CeFA. However, my final CeFA exam is on the 11th of next month, so with any luck I will get those extra letters after my name before too long

Good luck! Is the CeFA 4 exam multiple choice?