Financial planning is a rapidly growing profession in the USA. This growth creates the potential for unqualified advisers. Who is good and who can you trust? Quality is ensured by the CERTIFIED FINANCIAL PLANNER™ or CFP® marks. Both are registered trademarks of the CFP Board which is located in Denver.
The Four Es
Only certified members are permitted to use these designations. To obtain certification requires completing the four Es and maintaining ongoing continuing education. The four Es are ethics, education, experience, and examination.
Ethics requires that candidates for the CFP® certification agree to abide by the CFP Board’s Code of Ethics and Professional Responsibility and Financial Planning Standards. The candidate must also disclose any criminal, civil, or self-regulatory organizational proceedings that he/she is involved in. Maintaining creditability and minimizing fraud are major objectives of the CFP Board.
Education requirements can be met three ways: a Registered Program such as this, challenge status or transcript review. Most individuals meet this requirement through completion of course work in a Registered Program. However, individuals with a Ph.D. in finance or a J.D., for example, can qualify for challenge status and are eligible to sit for the CFP® Certification Examination. Finally, previous courses that cover the required material may qualify after transcript review by the CFP Board.
Experience means what it implies. Individuals must have actually worked in “the supervision, direct support, teaching or personal delivery of all or part of the personal financial planning process to a client” according to the CFP Board’s Guide to CFP® Certification. Individuals with a bachelor’s degree or higher must attain three years of experience. Until January 2007, those with less than a bachelor’s degree must attain five years of experience. Starting in January 2007, all qualifiers must have completed at least their bachelor’s degree.
Examination is a two-day, ten hour exam that is offered three times a year. Individuals must have completed their educational requirement, but not necessarily obtained their experience prior to taking the examination.
For more thorough information on the requirements to be become a CFP® certificant, check their web site at CFP-Board.org.
Education Requirement Curriculum
Candidates who hold an undergraduate degree in business must complete five courses. Those without a business background must take an additional mini course in the fundamentals of business, which has a heavy emphasis on the time value of money and also covers basic economics and statistics necessary to complete the educational program. This is necessary to cover the 101 topics that the CFP Board’s examination covers.
The fee is $925 for each regular course and $325 for the mini course with a $50 application fee.
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Rutgers University does not certify individuals to use the CFP®, CERTIFIED FINANCIAL PLANNER™ and federally registered CFP (with flame logo) certification marks. CFP® certification is granted only by Certified Financial Planner Board of Standards, Inc. to those persons who, in addition to completing an educational requirement such as this CFP Board-Registered Program, have met its ethics, experience and examination requirements.
Certified Financial Planner Board of Standards Inc. owns the certification marks CFP(R), CERTIFIED FINANCIAL PLANNER(tm) and federally registered CFP (with flame logo) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.
