The April 2015 CII J05 Exam – A Straightforward Paper
It’s time to do a review of the questions asked on previous sittings of CII J05. In this article we scrutinise both the April 2015 and October 2014 exam papers to see where candidates should focus their study efforts. This will be of interest to you if you’re planning to sit J05 in October.
This week we’re looking at the J05 April exam – Pension Income Options
The April 2015 Exam Paper
You can find a copy 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. Compare this to R04 which has a broader syllabus and only 10 Diploma credits. Admittedly it’s a written paper versus multiple-choice which is always going to be more challenging, but although we haven’t actually got the tape measure out, R04 seems to us here to be the thickest manual ever produced.
The April exam began with testing knowledge on deferring the State pension and the changes due to happen from next April – only 5 marks on offer but a nice start. Question 13 was also around the State Pension for someone reaching SPA in 2017 – no calculation was needed but 6 bullet points. Question 2 was a calculation – maximum PCLS and remaining LTA – this time 13 marks to reflect the ever complicated tax regime. Question 10 was also a calculation and again the marks of 15 reflected the knowledge needed around crystallisation to produce a set income and how death benefits are valued against the LTA. The rest of the paper seems OK – pension debits on divorce, eligibility criteria to take benefits before 55, third way annuities, PPF, death benefits and review factors. The last question was a lovely 10 marks for 5 benefits and 5 drawbacks on whether someone should take a transfer value from a DB scheme to use drawdown or take an early retirement pension plus PCLS. This surely would have been something anyone working in pensions would have taken time out to consider.
J05 seems to us a nice straightforward question paper with no curve balls.
The October 2014 Exam Paper
Let’s compare it to the previous paper – October 2014.
On first glance it seems to have been pretty straightforward as well with the same areas being tested; State pensions, a couple of calculation questions – LTA charges and enhanced LTAs due to pension credits, BCEs for SIPPs, areas for review, pros and cons for using an investment linked annuity over a conventional annuity and drawdown, the FAS, death benefits, commutation of small pension pots, phased retirement and finally mortality drag.
These papers seem fair for someone studying and working in pensions – looking at the pass results for 2013 and 2014 and you can see that out of the written J0 papers, which is now only J02, J03 and J07 they have the highest pass rates – with 58.68% in 2014 up from 58.13% in 2013.
The recent raft of pension changes will make this a more challenging paper next time round, but let’s hope the examiner continues to make it a well written and fair paper.
Grab the resources you need!
If you’re studying for your CII J05 exam, and you’re having sleepless nights with worry about how you’ll do, grab our free taster to try out one of Brand Financial Training’s mock exam papers for yourself. Click the link to download the J05 mock exam taster now!
If you’re planning on sitting J05 in October, do you think the recent pension changes will pose a challenge for you on exam day?