Certified Financial Planner

Encyclopedia : C : CE : CER : Certified Financial Planner

The Certified Financial Planner (CFP) and certification marks are financial planning credentials awarded by the [Certified Financial Planner Board of Standards Inc.]to individuals who meet education, examination, experience and ethics requirements.

Contents

1 Education requirements
2 CFP certification examination
3 Work Experience
4 Ethics
5 External links

Education requirements

As a first step to CFP certification, students must master more than 100 integrated financial planning [topics]. The topics cover major planning areas such as:

General principles of financial planning
Insurance planning
Employee benefits planning
Investment planning
Income tax planning
Retirement planning
Estate planning

Beginning in 2007, students will be required to have at least a bachelor's degree in any discipline from a regionally accredited U.S. college or university in order to become eligible for initial certification.

International degrees may be substituted for a U.S. undergraduate degree if they receive equivalency from a third-party organization such as the [Worldwide Educational Services].

CFP certification examination

The [CFP Certification Examination] is a 10-hour multiple choice exam, divided into one four-hour session (Friday afternoon) and two three-hour sessions (Saturday). The exam includes three major case problems and is designed to assess the student's ability to apply his or her financial planning education to financial planning situations.

Individuals holding professional designations pre-approved by the CFP Board (like PhDs in business and economics, lawyers, CLUs, ChFCs and certified public accountants), could register and sit for the exam without having to complete the education requirements by using the CFP-board's challenge status.

Work Experience

The CFP Board defines [work experience] as "the supervision, direct support, teaching or personal delivery of all or part of the personal financial planning process to a client" and such experience must fall within one or more of the following six primary elements of financial planning:

Establishing and Defining the Client Relationship
Gathering Client Data and Goals
Analyzing and Evaluating the Client's Financial Status
Developing and Presenting Financial Planning Recommendations and Alternatives
Implementing the Financial Planning Recommendations
Monitoring the Financial Planning Recommendations

Even after the student passes the exam and meets one or more of the six primary elements of financial planning, he or she must also have completed the following:

Three years full-time or the equivalent in the financial planning field for students who have an undergraduate degree from an accredited U.S. college or university
Five years full-time work experience for those who do not have an undergraduate degree
Be approved by the CFP Board during initial certification, which also involves an extensive background check

Ethics

The final component is the [ethics requirements]. Students and certificants are required to adhere to the CFP Board Code of Ethics and Professional Responsibility and to the Financial Planning Practice Standards. The CFP Board has the right to enforce them through its Disciplinary Rules and Procedures.

External links

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