Taking a Look at the Question Paper for April 2017’s CII J05 Exam
In this article, we discuss the questions set in the April 2017 exam paper for CII J05 – Pension Income Options. This will be useful for you if you are preparing to sit J05; it will help you to focus your revision on the areas that are likely to be examined.
You can find a copy of the April paper here.
Two hours are given to answer 15 short-answer questions for a total of 130 marks, and an exam pass secures 20 Diploma credits.
Questions 1 – 8
The April exam began with an eight-point question to calculate a LTA tax charge. Not a bad start, as most students would suspect this might come up. Question 2 was a theory question on the factors to consider when taking a UFPLS. The paper continued with the foundation amount for the new State pension, the fixed protection conditions and using an ISA rather than a dependant’s FAD plan. Another calculation followed, this time working out the net UFPLS after taxes has been settled. Question 7 was for 10 marks, and candidates had to outline the options available to a non-dependant son for a pension in capped drawdown. Question 8 tested the safe withdrawal rate.
Reading a review of the Apr 17 exam paper for CII J05 - useful for focussing revision Click To Tweet
Questions 9 – 15
Question 9 was for 14 marks and split into two: the first part was outlining the statutory levels of escalation for a PIE offer, and the second part asked for the pros and cons of electing for PIE. Question 10 was for 10 marks and asked for TPR steps that scheme members can take to protect their pension from a scam. Question 11 covered equity release and 12 tested death benefits from a DB scheme. Onto the home straight and Question 13 required candidates to calculate the maximum PCLS, Question 14 was the pros and cons for using phased FAD and finally Question 15 was a (one-sentence) question on the State pension benefit statement. Overall, this paper seemed to us relatively straightforward with no curve balls.
Comparison with the October 2016 Exam Paper
Let’s compare it to the previous paper, which was sat in October 2016. If you haven’t seen it you can find it here.
On first glance, it also seems like a fair paper with similar areas being tested such as LTA, statutory escalation, net amount from a UFPLS, with other subjects thrown in, such as small pots payments, income from a SSAS, capped drawdown, deferral options for State pension and risk.
Both papers seem fair and reasonable for someone working in pensions. Looking at the published pass rates for 2016, we can see that out of the written J0 papers, now only J02, J03 and J07, J05 had the highest pass rate of 63.51% just ahead of the Trusts paper which had a pass rate of 58.37%. This was an improved position for J05 from 2015 where just 57.49% of students had passed.
The only thing that does stand out with J05, is the length of the questions – certainly when you compare them with J03 and J02, the amount of text a student has to read before even getting to the question is a lot more. When the exam is given the same two hours, this must put J05 candidates at a slight disadvantage.
On a brighter note, pensions exams will always be challenging, but let’s hope the examiner continues to keep J05 a well-written and fair paper.
Grab the resources you need!
If you’re studying for your CII J05 exam, and you want to be fully prepared, grab our free taster to try out one of Brand Financial Training’s resources for yourself. Click the link to download the J05 mock paper taster now!
Over to You…
Have you taken the J05 exam in either of the April or October sittings? What did you think of it?