CFP: 7 Free Practice Questions

Updated 15 October 20266 min read

Key takeaway

Answer 7 original Sitonce questions without an account, then check your score and read the explanations.

This small study sample helps you spot ideas to review.
It does not reproduce the full examination or predict a pass.
The separate full course provides lessons and further practice.

These are original Sitonce study questions, not official or recalled exam items. No account is needed to answer this public sample or read its explanations.

Start the 7-question sample

For a longer session, browse all 170 questions or start the free timed CFP practice test. The full paper includes a domain breakdown after submission.

Your 7-question practice sample

Choose one answer per question. You can change your choices before checking your score. A blank earns zero.

Question 1 of 7A client aged 58 separates from service with her employer in the year she turns 58 and wants to take a distribution from that employer's 401(k). Which is correct?

The distribution is subject to the 10% early-distribution penalty because she is under 59½The distribution may avoid the 10% penalty under the separation-from-service exceptionShe must roll the balance to an IRA first to avoid the penaltyThe penalty applies unless she takes substantially equal periodic payments

Answer and explanation for question 1

Answer: B. The age-55 separation-from-service exception can remove the additional tax for a distribution from the employer plan after separation in or after the year the employee reaches age 55. The exception generally does not carry over to an IRA, so rolling the money over first can change the result. The ordinary age-59½ rule is not the only rule to check.

IRS: separation-from-service distribution exception

Question 2 of 7A business owner plans to transfer the company to one child, while intending to leave the other child an equal inheritance. Most of the owner's wealth is tied up in the business, and there is no succession agreement or independent valuation. Which planning issue most directly needs to be addressed before promising an equal division?

Estimating retirement spending from the owner's IRA aloneSelecting investments for the company's operating cashCoordinating business succession, valuation, and fair treatment of both heirsChoosing a distribution strategy for the owner's retirement plan

Answer and explanation for question 2

Answer: C. The stated objective combines a transfer of a closely held business with fair treatment of two heirs. Without a valuation and succession plan, the owner cannot tell whether the proposed transfer is financially workable or how to balance the inheritance. The other choices may matter later, but they do not resolve the conflict in the stated objective.

CFP Board topic outline: estate and business-succession scope only; answer follows the stated planning objective

Question 3 of 7A CFP professional selects one of two suitable mutual funds because it pays her a higher commission. She discloses the difference in writing and the client signs. Which is correct?

Compliant - the conflict was disclosed and consented toCompliant, provided the fund is suitableNot compliant - the duty of loyalty requires acting without regard to her own financial interestNot compliant - commission-based compensation is prohibited

Answer and explanation for question 3

Answer: C. Disclosure and informed consent do not permit placing the professional’s financial interest ahead of the client. Choosing because it pays more violates the duty of loyalty. Suitability alone is insufficient; commission compensation is not categorically prohibited.

CFP Board, Code of Ethics and Standards of Conduct · CFP Board, What You'll Be Tested On

Question 4 of 7A client wants USD 1,000,000 in twenty years and invests monthly at a nominal annual rate convertible monthly. Use a TVM worksheet with P/Y=C/Y=1; each entered period represents one month. Which period/rate setup is correct?

N=20, I/Y=annual rate, FV=1,000,000, solve PMTN=240, I/Y=annual rate, FV=1,000,000, solve PMTN=240, I/Y=annual rate divided by 12, FV=1,000,000, solve PMTN=20, I/Y=annual rate divided by 12, FV=1,000,000, solve PMT

Answer and explanation for question 4

Answer: C. With P/Y=C/Y=1 and each entered period representing one month, 20 years gives N=240. Enter the nominal annual percentage rate divided by 12 as I/Y. These are deductions from the supplied calculator configuration and rate assumption. The outline link establishes topic scope, not this calculation.

CFP Board topic outline: time value of money scope only; calculation follows supplied assumptions

Question 5 of 7A home has replacement cost USD 500,000, coverage USD 300,000, an 80% coinsurance requirement and a USD 1,000 deductible. For a covered USD 100,000 partial loss, the policy pays (coverage carried / coverage required) × loss, less the deductible. No other adjustment applies. Approximately what is paid?

USD 99,000USD 74,000USD 60,000USD 100,000

Answer and explanation for question 5

Answer: B. Under the stated formula, required insurance is 0.8 × 500,000 = 400,000. The carried/required ratio is 300,000/400,000 = 0.75. Apply it to the 100,000 loss and subtract the 1,000 deductible: 74,000. Ignoring the ratio, applying it to the wrong base or ignoring the deductible gives the other amounts.

CFP Board topic outline: insurance-planning scope only; arithmetic follows the supplied policy formula

Question 6 of 7A bond fund has a modified duration of 6.5. Ignoring convexity and other changes, what is the approximate effect of a one-percentage-point rise in yield?

The fund will fall by about 6.5 per centThe fund will rise by about 6.5 per centThe fund will fall by about 1 per centDuration does not predict price movement

Answer and explanation for question 6

Answer: A. The duration approximation is −6.5 × 0.01, or a 6.5% price decline. A rise in yield has the opposite sign to the price movement. This is an approximation, not a guaranteed fund return.

FINRA: interest-rate changes and duration

Question 7 of 7A father gifts stock with an adjusted basis of USD 50,000 and a gift-date fair market value of USD 30,000 to his daughter. With no intervening basis adjustments, she later sells it for USD 40,000. What is her gain or loss?

A loss of USD 10,000A gain of USD 10,000No gain and no lossA loss of USD 20,000

Answer and explanation for question 7

Answer: C. For a gift with value below the donor’s adjusted basis, the donor basis is used for gain and gift-date value for loss. A sale between USD 30,000 and USD 50,000 produces neither gain nor loss, assuming no later basis adjustments.

IRS Publication 551: gift basis below donor basis

Your topic scorecard

Correct answers out of the questions sampled in each topic; Items lists the question numbers
Topic	Items	Score
Professional conduct	3	? / 1
General principles	4	? / 1
Insurance planning	5	? / 1
Investment planning	6	? / 1
Tax planning	7	? / 1
Retirement planning	1	? / 1
Estate planning	2	? / 1
Total	1-7	? / 7

This seven-question introduction samples seven planning areas. It does not assess Psychology of Financial Planning, full case analysis or the complete CFP outline. It is not weighted to the examination. A perfect score only means you answered this small sample correctly. It does not establish exam readiness or predict a pass.

For each missed answer, write the controlling fact or rule in one sentence. Then work through an unfamiliar question on the same topic. Repeating this answer key from memory is not the same as learning the rule.

Continue with the full course

The public sample is a small part of your preparation. View the separate CFP Exam course for its lessons, practice and full mock options. Account and course-access requirements apply to those separate features.

Common questions

Do I need an account for these questions?

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Does this score predict whether I will pass?

No. This short sample is not weighted or calibrated to predict an official result. Use missed answers to choose what to review next.

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