LLQP Segregated Funds & Annuities · Component 1.1 · 35% of the exam
A 30-year-old saving for retirement with stable income and no debt has a profile pointing toward:
- AMoney market funds only, since capital preservation matters most when saving for something as important as retirement
- BAn immediate annuity, since locking in lifetime income early removes all future investment risk
- Growth as the primary objective, a long horizon, and equity-oriented funds in a registered plan
- DGICs only, since guaranteed returns compounded over thirty-five years will exceed any market return
Correct answer: C) Growth as the primary objective, a long horizon, and equity-oriented funds in a registered plan
Long horizon and capacity for risk favour growth. Registered plans add tax efficiency.
Why the other options are wrong
- AMoney market funds cannot meet a growth objective over 35 years.
- BAnnuities suit retirement income, not accumulation at 30.
- DGICs alone under-serve long-term growth and lose to inflation.
Exam tip
Young, stable, long horizon: growth, higher equity, registered.
Common mistake
Over-weighting safety for a client decades from retirement.
What this tests
CISRO competency component 1.1 — Assess the client's needs and situation — which is weighted at 35% of the Segregated Funds & Annuities module. Written against the published curriculum.
More from component 1
- The first step before recommending a segregated fund or annuity is to:
- A client's 'time horizon' for an investment is:
- 'Risk tolerance' in an investor profile refers to:
- A client says he wants 'high returns with no risk of losing money'. The agent should:
- Investment objectives are commonly classified as:
- Why is the client's marginal tax rate relevant to a segregated fund recommendation?
Practice the whole Segregated Funds & Annuities module
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