Posted by: Kaplan Financial Education
Updated: October 4, 2018
With financial advising projected to be one of the top 10 fastest growing occupations, getting your CFP® mark can help set you apart in the industry. Let’s take a look what a CFP® professional is and what it takes to earn financial planning certification.
A CFP® professional works with clients to create comprehensive plans for meeting their long-term financial goals, such as retirement, college tuition, business start-up, a home, and so on. According to a 2017 CNN Money report, CERTIFIED FINANCIAL PLANNER™ jobs are expected to grow 30 percent over the next 10 years, making it an excellent career option for young financial professionals. Many CFP® professionals work in large financial or insurance firms, although some choose to have their own businesses. To become one, you have to meet certain requirements.
To becoming a CFP® professional, you must:
Candidates are most concerned about the CFP® exam. Here’s what you need to know.With financial advising projected to be one of the top 10 fastest growing occupations, getting your CFP® mark can help set you apart in the financial advising industry.
The standard registration fee for the CFP® exam is $695, but there’s an early bird rate of $595, which is good until six weeks before the registration day. There’s a late registration fee of $795 for the two weeks before the registration deadline. You can register for the CFP® exam with CFP Board online or by phone before or after you complete the education program coursework and become eligible for the exam. If you register before you finish the coursework, you must send CFP Board proof of your completed coursework. CFP Board will notify you when your eligibility is confirmed.
The exam is given in a computer-based format and consists of 170 multiple-choice questions that test your financial planning knowledge in client situations. You are given the exam in two 3-hour sessions with a 40-minute scheduled break. Preparing for the CFP® exam requires a significant time commitment. CFP Board recommends you spend at least 250 hours studying for the exam. While that sounds overwhelming, the time goes pretty quickly between pre-study, the Candidate Handbook, required education courses, question bank time, a review class, practice exams, and your own review preparations.
A great way to approach preparing for the CFP® exam is to think of it like training for a marathon. It’s not a situation where you can sprint (or cram). There’s just too much to learn, and you’ll need to be able to apply it to case studies. So, you make sure you have the space in your life to dedicate the necessary hours to study. Then, create a strategic study plan. A great way to structure your plan is to mirror the exam weighting, which the CFP Board updates based on regular job task analysis. At the same time, you shouldn’t start off by studying the most heavily weighted topics in depth. Instead, learn the basics of each category first. Then, work deeper into the categories based on weight and your familiarity with them, so you can absorb more detail.
Here are few tips that can help you pass the exam:
Focus on learning when you study. The CFP® exam is all about applying knowledge to real situations you could encounter on the job. Twenty percent of the exam’s scoring rests on two case studies that expect you to analyze a hypothetical client situation and determine the best next steps. Therefore, rather than spending all your time on memorizing, you need to work on mastering the material and applying it.
Practice exam questions. The more you practice, the more familiar you will become with how to apply your knowledge. Work with questions that have the same difficulty level as the actual exam to determine if you have truly mastered a particular domain and where you might be making mistakes. You can find practice questions at the end of prep provider chapters, in prep provider bank quizzes, and in practice exams from CFP Board and prep providers.
Don’t cram the day and night before. Feverishly going over lists or taking full practice exams can be mentally draining, so avoid them on the day before the exam. Instead, reread some of the wordier areas of the curriculum like ethics. Think about what it could be like to be advising clients in the future and practice answers to the questions they might ask. Then, stop about dinner time, just as if you were already in the office, relax, and have a good meal.
Picture yourself passing. Before a big exam like this, it’s natural to panic and worry about failing. Instead try to visualize yourself answering questions competently and getting a great score. Positive affirmation can go a long way to calm your nerves and put you in the right mindset.
Once you have your CFP® certification, you must complete three renewal requirements every two years. First, you will have to submit a non-refundable $100 fee for a background check. Second, you’ll have to pay a non-refundable $325 certification fee. Third, you’ll need to complete a minimum of 30 hours of continuing education.
Are you ready to get started on the path toward financial planning certification with your CFP® certification education? Enroll with Kaplan Financial Education by visiting our website or calling a designation specialist at 866.963.8329.
Are you considering CFP® certification, but are unsure if you can handle it? Get a sneak peak at the beginning of the Kaplan education program to get a feel for whether CFP® certification is the right fit for you. This free eBook will provide you with information about the financial planning process learned in Course 101: General Financial Planning Principles, Professional Conduct, and Regulation. It also includes several analytical problems that will allow you to apply the knowledge you learn in real-life scenarios.