This was our older couple who were approaching retirement with much more in deposits and investments and with quite different needs to Andrew and Carrie such as, retirement, suitable investments and passing on their estate tax efficiently using trusts.
Generally candidates felt more comfortable with CS1 as they could identify with Andrew and Carrie. Dylan and Susan, being older, were in a different demographic than most of the R06 exam candidates. Let’s consider one of the more ‘left field’ questions that came up:
‘Identify the factors that would typically influence Dylan and Susan’s capacity for loss.’ (10 marks).
This would have worried many candidates firstly as they were not expecting this question, and secondly due to the amount of marks available.
So what is capacity for loss?
In short, it is how much can you afford to lose before seriously impacting on your lifestyle? You may feel you have a very high loss capacity but if you have very little in deposits and investments your capacity for loss is towards the lower end of the spectrum.
This was a generic factors question, not specific as we had with CS1. It also required you to ‘identify’ not ‘explain’ so this was much more about a list of generic factors. For example, what could affect how much money you could afford to lose? Well for a start; your age, health, timescales, financial objectives, emergency fund requirements, future inheritances…
BTS tip: To prepare for this type of question coming up in your exam, identify and learn lists of generic factors related to key need areas then be prepared to adapt this according to the need areas of the question asked in the exam.
There’s still time to book on the BTS R06 workshop for the April exam sitting. This two-day workshop will take you through a deep-dive into each of the April case studies, helping you to anticipate possible questions, plan your answers and practise writing these, all with feedback and discussion from the expert BTS facilitator.
If you can’t attend the workshop, get yourself a copy of the BTS Case Study Analysis, due for release on Tuesday 6th April. This will include as many potential questions that the experts at BTS have been able to identify from the exam case studies, including suggested answers and crib sheets on relevant technical areas (attendance on the workshop gives delegates access to this analysis as part of their booking fee). Look out for the Case Study Analysis e-Learning module in the BTS shop from 6th April.