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FINRA Series 65 Exam 174 Questions with Verified Answers,100% CORRECT
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FINRA Series 65 Exam 174 Questions with Verified Answers
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FINRA Series 65 Exam 174 Questions with Verified Answers1. Investment Advisory Representative (IAR) - CORRECT ANSWER 1. Upon passing
the series 65 the agent may represent an registered investment adviser (RIA) and
receive fee based compensation. The fee based compensation may be based on a
percentage of the assets under management or as an hourly or flat fee for
providing a personalized financial plan. There are no prerequisites for taking the
series 65 exam and the candidate does not need to be sponsored by a FINRA
member firm to take the test.
2. The series 66 is the uniform combined state law exam and qualifies a candidate
to represent both an investment adviser and a broker dealer. After passing the
series 66 an agent may receive both fee based compensation for representing an
investment adviser and transition based compensation for executing customer
orders. The series 66 is a combination of the series 63 exam and the series 65
exam. Candidates do not have to be sponsored by a FINRA member firm to take
the series 66 exam. However, the series 7 exam is the co requisite for the series
66 exam and a candidate who has passed the series 66 exam may not conduct any
business until they have passed the series 7 exam. All candidates must be
sponsored to take the series 7 exam. If you have passed the series 7 exam and
have not taken the series 63 exam, the series 66 may be the right exam to take.
Keep in mind that while the series 66 has fewer questions than the series 65. If
you have not passed the series 7 or will not be taking the series 7 exam you must
take the series 65 exam.
the financial effect of making student loan payments for 20 years after graduating
from college can be easily seen - CORRECT ANSWER the financial effect of making
student loan payments for 20 years after graduating from college can be easily
seen.
For example, a college graduate who owes $60,000 in student loans at 3%
interest will have to pay $332.76 per month for 20 years to get that paid off. If
that amount was instead diverted into a Roth IRA that grows at 6% for that same
time period (with no further contributions after 20 years), then the student would
,have almost $600,000 of tax-free money by age 65. No poll or study is necessary
to see the enormous impact that student loan debt can have on a borrower's
retirement preparedness. (For more, see: Student Loans: What to Do When You
Can't Repay Them.)
Certificate of Deposit (CD) - CORRECT ANSWER 1. a time deposit at a commercial
bank and insured by the FDIC that restricts holders from withdrawing funds on
demand.
2. bears a maturity date ranging from one month to five years at a fixed interest
rate and can be issued in any denomination.
Negotiable Certificates of Deposit (NCD)
(Jumbo CD) - CORRECT ANSWER 1. a large certificate of deposit that is typically
purchased by institutional/company investors.
2. Unlike a regular CD, NCDs pay periodic interest, usually twice a year and cannot
be cashed in before reaching maturity, but can be easily sold in the open market
before that time.
3. minimum face value of $100,000, but typically are $1 million or more.
Treasury Bills (T-bills) - CORRECT ANSWER 1. short-term securities that mature in
3-months, 6-months or 1-year.
2. exempt from state and local taxes.
3. purchased at less than par.
4. issued in denominations at $1,000, $5,000, $10,000, $25,000, $50,000,
$100,000 and $1 million.
5. all Treasuries are considered to be risk-free (safest investments in the world).
Treasury Notes (T-notes) - CORRECT ANSWER 1. a maturity between 1 and 10
years.
2. exempt from state and local taxes.
3. purchased at face value and pay out interest payments semi-annually.
4. bought through a bank or directly from US gov't.
5. can be sold in a large secondary market (liquidity).
Treasury Bond (T-Bond) - CORRECT ANSWER 1. a maturity of more than 10 years.
2. exempt from state and local taxes.
3. purchased at face value and pay out interest payments semi-annually.
,4. issued with a minimum denomination of $1,000 and maximum of $5 million.
5. After auction, bonds can be sold in the secondary market.
6. bonds can be bought directly from the government through TreasuryDirect at
http://www.treasurydirect.gov, thereby bypassing a broker.
U.S. Savings Bonds - CORRECT ANSWER 1. offer a fixed rate of interest over a fixed
period of time.
2. not subject to state or local income taxes.
3. cannot be cashed until at least six months after purchase but maturity varies
somewhere between 15 to 30 years.
4. come in 8 values: $50, $75, $100, $200, $500, $1,000, $5,000, and $10,000.
5. purchased directly from the Dept of the Treasury but can be cashed out at most
banks.
6. must be an American citizen.
Municipal Bonds - CORRECT ANSWER 1. are exempt from federal taxes and from
most state and local taxes.
2. issued by a state, municipality or county to finance its capital expenditures
(such as the construction of highways, bridges or schools).
Zero-Coupon Bonds - CORRECT ANSWER a type of bond that makes no coupon
payments but instead is issued at a considerable discount to par value.
Brady Bonds - CORRECT ANSWER 1. are U.S. dollar denominated bonds that were
issued by mainly Latin American countries, with U.S. Government 30 year zero
coupon bonds serving
as collateral to ensure payment of the principal.
2. were created in March of 1989 and named for the then U.S. Treasury Secretary,
Nicolas Brady.
Yankee Bonds - CORRECT ANSWER a bond denominated in U.S. dollars that is
publicly issued in the U.S. by foreign banks and corporations. These bonds must
be registered under the Securities Act of
1933 with the SEC before they can be sold.
Individual Retirement Arrangement (IRA), Traditional
, [There are several other types of IRAs: Roth SIMPLE and SEP IRAs.] - CORRECT
ANSWER 1. Maximum contribution of $5,500 ($6,500 if you're age 50 or older), or
your taxable compensation if less with excess contributions taxed at 6% per year
as long as they remain in the account.
2. Can make contributions up to age 70 1/2.
3. Contributions may be tax deductible depending on the taxpayer's income, tax
filing status and coverage by an employer-sponsored retirement plan.
4. Distributions are taxed as income and any distributions before you age 59½
incur a 10% additional tax (You generally can make a tax-free withdrawal of
contributions if you do it before the due date for filing your tax return for the year
in which you made them).
5. Required Minimum Distributions (RMD's) at age 70 1/2 or a 50% excise tax on
the amount not distributed as required.
(Depending on income, an individual may be able to fit into a lower tax bracket
with tax-deductible contributions during working years and also be in a lower tax
bracket during retirement).
Individual Retirement Arrangement (IRA), Traditional
Deduction Limits If You Are NOT Covered by a Retirement Plan at Work (2015) -
CORRECT ANSWER Full Deduction
S / HH / QW = any amount
MFJ / MFS (spouse not covered at work) = any amount
MFJ (spouse is covered at work) = $183,000 or less
Partial Deduction
MFJ (spouse is covered at work) = >$183,000 but <$193,000
MFS (spouse is covered at work) = <$10,000
No Deduction
MFJ (spouse is covered at work) = >$193,000
MFS (spouse is covered at work) = $10,000 or more
Individual Retirement Arrangement (IRA), Traditional
Deduction Limits If You Are Covered by a Retirement Plan at Work (2015) -
CORRECT ANSWER Full Deduction
S / HH = $61,000 or less
MFJ / QW = $98,000 or less
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