Certified Financial Planner CFP Certification Program

CERTIFIED FINANCIAL PLANNER – JANUARY 2025 INTAKE

The CFP certification program is an application program for financial planners.

It provides the knowledge and skills needed to apply the financial planning process to analyze people's needs and circumstances, evaluate the effectiveness of current strategies, assess the different options to reach their objectives, and create an effective recommendation based on their current circumstances.

It is not an academic program that teaches financial theories on a wide range of products and personal financial subjects.

At the end of this program, you should know how to apply the financial planning process, including where to begin, what to do next, what information is needed, and what results to anticipate.

The final examination will test your application knowledge on everything that you have learned from Module 1 to Module 4.

For enrollment information and our training fee and schedule, please contact us via WhatsApp at 012-8182805.

Dear Life Insurance Agents,

Did you know that the CFP Module 1 and 2 can be waived for life insurance agents who hold a degree?

Would you like to earn the CFP credential by year end?

What you should do is as follows:

1) Finish the online course Professionalism of Insurance and Takaful Operators' Agents.

2) Register for the CFP Modules 3 and 4 with us.

3) Participate in the Tax and Estate planning workshops offered by us.

4) Take the September 2024 exam for Module 3 and the December 2024 exam for Module 4.

Having the CFP credential will make you a more competent life insurance advisor.

For more information, please visit our website https://www.practicalwealth.co/
Or contact us at 012-818 2805

Why enroll in CFP Module 1?

The Time Value of Money (TVM) is a tool used by financial planners to analyze and develop individualized financial plans.

If you are offering personalized financial advice, you will come across clients with unique needs and circumstances that require lots of customized computations that cannot be adequately performed with ready-made financial calculators.

The CFP Module 1 equips financial planners with the essential knowledge to perform customized financial calculations to develop individualized financial solutions. Without a solid understanding of TVM, many will have difficulties developing personalized advice for those with unique situations.

Therefore, do not miss the TVM training in the CFP Module 1 program.
Enroll now! The June 2024 intake is now open for registration.

What do you learn in CFP module 1?
- Regulatory controls affecting financial planning
- Economic environment & its effects on financial planning
- Analytical tools for financial planning professionals
- Risk management & insurance planning
- Investment planning
- Taxation planning
- Retirement planning
- Estate planning
- Financial planning process
- Financial planning code of ethics

Who is eligible to apply?
1) Holder of a degree
2) A diploma holder with five years of personal finance experience and a FIMM license
3) SPM holder who passed the PLRA exam and has five years of experience in personal finance

For more information, please visit our website https://www.practicalwealth.co/ Or contact us at 012-818 2805

CFP Module 3
Investment Planning and Retirement Planning

CFP M3 equips participants with the technical knowledge needed to analyze and develop investment and retirement plans.

It is one of the toughest modules in the CFP program as it requires participants to learn lots of investment calculations.

However, our systematic training program that simplify the complicated subjects has enabled most participants to pass the examination in their first attempt.

What do you learn in CFP Module 3?

Investment concepts
Portfolio theory and performance measures
Equity and Debt securities investments
Derivatives and structured products
Collective investment schemes and unit trusts
Real estate investments
Investing for retirement
EPF and PRS
Retirement income streams
Pre-retirement counseling

Who can enroll?
1) Degree holder
2) Diploma holder with FIMM license and 5 years experience in personal finance
3) SPM holder with 5 years experience in personal finance who passed the PLRA assessment

For more information, please visit our website https://www.practicalwealth.co/Or contact us at 012-818 2805

Certified Financial Planner (CFP)
Module 4 Financial Plan Construction & Professional Responsibilities

Do you find the CFP M4 case studies intimidating?
Have no confidence in sitting for the CFP M4 exam?
Don't worry. We understand how it feels.

If you are well-guided and understand the process of constructing answers, CFP M4 is not tough.

The CFP M4 module aims to enhance your ability to assess an individual's financial status and design a customized integrated financial plan according to their situation and needs.

We walk our students through a variety of case studies and allow them to practice the process of making recommendations until they feel comfortable with it, as skill development is a process that takes a lot of practice.

This will prepare them for the final exam and to create a comprehensive financial plan for their customers in real situations.

For more information and enrollment, please contact us at 012-818 2805 or visit our website https://www.practicalwealth.co/

CFP Module 3 March 2023 examination result
86% passing rate - Out of 21 candidates took the exam, 18 candidates passed.

Module 4 examination result has just been released.

We achieved 78% passing rate.

Out of 18 candidates took the exam, 14 candidates passed.

Emergency Cash Reserve is your RISK RETENTION plan.

An investor asked where to invest at this time?
Before I answered that question, I asked how long his cash in hand would cover his expenses.
He did not expect my question.
After explaining the concept, he said no one had told him about it.

What are the potential problems of not having a cash reserve?
Anything can happen at anytime that requires us to cover expenses not on our list.
When that happens and if we do not have the cash in hand, we will have to borrow from others.
Most people will sell their investment even at a loss.
Besides realising investment losses, our investment proceeds may not reach us in time to cover urgent expenses.

What is an Emergency Cash Reserve?
An cash reserve for unplanned large expenses, such as medical bills, car repairs, income loss etc.

How much should you keep as a reserve?
General rule of thumb is 6 months of normal monthly living expenses or 12 months of bare-bones monthly living expenses, whichever is higher.

What if your situation differs from the rule of thumb?
The rule of thumb is based on a normal economic environment where most people can regain employment within 6 months.

But your situation might differ and the amount might not be enough or too much for you.
Cash is not a growth asset. So too much cash may reduce your future purchasing power and portfolio's return.

How to keep sufficient emergency funds without affecting portfolio growth?

Ask yourself these questions:
What can happen to you that requires additional cash to cover unplanned expenses?
How much do you need for each identified event?
What can you do about the events or the consequences?
Can you eliminate the occurrence or reduce the frequency or the impact of events?
Can you transfer the expenses to a third party or insurer?
What consequences cannot be eliminated nor transferred?

A cash reserve is part of your risk management plan to prepare yourself for unplanned expenses that CANNOT be avoided nor transferred.
In other words, your Emergency Cash Reserve is your RISK RETENTION plan.
Therefore, it should not be done in isolation, but according to your situation as a whole.

A young man came to me recently about a concept he did not fully agree with - delayed gratification.

Delayed gratification is a wealth accumulation concept that says if you invest your money instead of spending it now, you will have more money to spend in the future.

This concept is true if the return on your investment is higher than inflation and all returns are reinvested (compounding).

But is it practical? Why are people not implementing it?

Are they really lacking the discipline and succumb to the temptation to spend?

What use is a concept if it is difficult to implement?

My answer to this young man is this.

We do things that give us pleasure.

Why? Because we are humans and not machines.

So to implement this concept, we first need to ensure our basic needs are taken care of.

If delayed spending causes too much discomfort, we will spend the money.

Secondly, can we see what our money can do in the future if it is invested?

Can we visualise or feel the pleasure now?

Have we been guided to discover the pleasure of achieving our future goals?

Thirdly, has the investment brought us pleasure?

Do we see our money growing?

Or has the investment been disappointing, like an annual return below expectations or losing money?

Are we feeling joy or pain investing?

No matter how profound the concept is, if people cannot find pleasure in implementing it, it won't be sustained.

When I receive my salary, where should I invest? Car or house?

A fresh graduate asked when they (a group of friends) received their salaries, should they invest in a car or a house?

My answer is both are necessities. You need them to live a decent life.

Over time, your car will depreciate and your house will appreciate in value.

But the house you stay in is not an investment asset.

So set a limit as to how much you should spend on car and the house you stay in.

Luxury items are essential for enjoyment, but not necessities. So do not spend too much money on nice things that do not really help you live a meaningful life.

Your long term goal should be to accumulate investment assets that grow above the inflation rate and provide an income stream for you.

Leverage on bank loans to accumulate investment assets but avoid loan on depreciating assets.

If you are eligible to take a RM1 million loan to purchase a property, buy two properties instead of one.

Buy your second car with cash to maximize your loan eligibility to accumulate investment assets.

When you accumulate investment assets, learn how to maximise IRR.

Ultimately, you want to grow your passive income to match at least 50% of your active income.

Most importantly, invest in yourself because your abilities are the most capable assets of growing wealth and generating income.

It is your abilities, mindset and character that help you realise your ambitions and dreams.