Certified Financial Planner (CFP) Certification

  1. CFP Certification





What is the CFP certification?
The CFP (Certified Financial Planner) certification is a high-level accouting credential aimed at professional financial planners and offered by the Certified Financial Planner Board of Standards (CFP Board). It is awarded to financial professionals who have demonstrated the ability and experience necessary to conduct themselves with high levels of professionalism, integrity, objectivity, competence, and diligence when dealing with their clients.


Who is the CFP certification for?
The CFP certification is for individuals who already have, or are considering, a career in Financial Planning. Typically, the certification is suited to individuals wishing to pursue a career offering high-level, professional financial planning advice to both individuals and corporate clients. Typical areas of specialty may include (but are not limited to):
  • General Financial Planning and Consulting
  • Retirement Planning
  • Asset Protection
  • Estate Planning
  • Investment and Securities Planning and Consulting
How do I obtain the CFP certification?
In order to earn the CFP credential, candidates must meet the requirements of the four ‘E’s’. That is:
  • Education
  • Examination
  • Experience
  • Ethics

Education

Candidates must complete a college or university-level course (approved by the CFP Board) that covers the main areas of financial planning outlined in the CFP Board’s current Job Analysis Study. There are more than 300 approved education programs from more than 200 educational facilities across the U.S. registered with the board.
At the completion of the main body of coursework, candidates must also complete a CFP Board-approved financial plan development (capstone) course.

Candidates must also hold a Bachelor’s Degree from an approved educational facility. Candidates may apply to take the CFP exam before completing their Bachelor’s Degree, but the certification will not be awarded until all of the educational requirements have been met.


Examination

After meeting the educational requirements, candidates may apply to take the CFP exam.

The exam is delivered as a CBT (computer-based testing) exam. The exam consists of 170 multiple-choice questions including some stand-alone or scenario-based questions. The scenario questions can vary in complexity, ranging from just a few questions right up to 10-20 questions per scenario.

The exam is separated into two 3-hour sessions, with a 30 minute break offered in between.  Allowing for travel time, checking in and registration, verification of ID etc., candidates should prepare for an all-day event.

Candidates will receive a preliminary exam result at the conclusion of their exam at the testing facility. The results will be verified and official confirmation will follow from the CFP Board within three weeks of the conclusion of the exam testing window. Candidates who fail the exam will be provided with a diagnostic report of their exam performance.

In recent times, the CFP exam has typically had a historical pass rate ranging anywhere from 50% up to 68%.


Experience

Candidates are required to have at least three years (6000 hours) of relevant professional experience in financial planning processes (or two years of apprenticeship experience with certain conditions). The experience requirement must be fulfilled within 5 years of passing the CFP exam.


Ethics

Once candidates have passed the education, examination and experience requirements they will need to fill out the CFP Certification Application questionnaire. Here the candidate will need to disclose, openly and honestly, information about their background including any involvement in any criminal, civil, governmental or self-regulatory agency proceeding or enquiry.  Candidates are also required to disclose any previous financial or professional issues, such as bankruptcy, customer complaints, employer disputes and so on.

Based on the information disclosed by the candidate, the CFP Board will conduct a thorough background check and determine the candidate’s suitability to be awarded the CFP credential.
What is the passing score?
The CFP Board does not have a predetermined exam passing score, nor do they predetermine the passing rate of the exam. Instead, a group of CFP Board professionals use an industry-standard method (Standard Setting) to determine the criterion for passing the CFP exam. More information about the CFP passing score can be found here.
What are the CFP certification renewal requirements?
CFP credential holders are required to renew their CFP status through a series of annual and bi-annual activities. Firstly, candidates must pay the yearly certification fee (currently US$325), and then every two years candidates must submit a completed certification application and have completed 30 hours of approved continuing education (CE). Of this 30 hour CE requirement, 2 hours should be spent covering the topic of ethics. The CE study requirements can be redeemed in a number of ways, including self-study courses, in-house training, authoring publications, professional conferences, etc.

There is no ‘inactive’ status for the CFP. Candidates wishing to keep their credential must ensure that they meet the ongoing CE requirements.

Where can I take the CFP exam?
The exams can be taken at most Prometric testing facilities during any of the testing windows. There are just three 5-day testing windows each year (March, July and November).