AAMS® vs. CFP® Mark: Which Designation Is Right for Me?
A special designation in financial planning can set you apart from the competition and boost your career. But should you earn the AAMS® or the CFP® mark? Both lead to rewarding, professional opportunities for those who want a career in personal finance and planning, but the topics they cover, their requirements, and their benefits are slightly different. In this article, we compare the AAMS® vs. CFP® mark to help you choose the credential that’s right for you.
AAMS® Designation Overview
The Accredited Asset Management SpecialistSM (AAMS®) program provides advisors with fundamental financial knowledge of asset management and investments. Offered exclusively online by the College for Financial Planning®—a Kaplan company (CFFP), the AAMS® credential and program are designed to help personal financial advisors who are just starting out in their careers. However, more experienced financial advisors can benefit from the credential, too, because it lets clients know they have a specialty in asset management.
Get more details in this AAMS® designation article.
Requirements for Earning the AAMS® Designation
To earn the AAMS® designation, follow these steps:
- Complete a 10-module education program provided by CFFP. There are no prerequisites for this program, which typically takes 9–11 weeks to complete. The modules cover the asset management process; risk, return, and investment performance; asset allocation and selection; investment strategies; taxation of investments; investing for retirement; deferred compensation and benefit plans; insurance products for investment clients; estate planning for investment clients; and fiduciary, regulatory, and ethical issues for advisors.
- Take and pass the AAMS® exam. You must take the test for the first time within six months of enrolling for the program, and you have a year to pass it. There are 80 questions on the exam, and the passing score is 70 percent. Plan on studying for about 80–100 hours.
- Agree to abide by a code of ethics.
The AAMS® designation is recognized as the industry benchmark for asset management credentials and is endorsed by leading financial firms. Compared to earning an MBA or other credentials, the AAMS® designation is a relatively low-cost ($1,300) way to advance your career and lets clients know you have deep knowledge in asset management and investments. Financial advisors with the AAMS® credential report an average earnings increase of 20 percent, as well as client-base growth and greater job satisfaction.
CFP® Certification Overview
The CERTIFIED FINANCIAL PLANNER™ (CFP®) mark enables finance professionals to help individual clients create comprehensive plans for meeting their long-term financial goals, such as retirement, college tuition, business start-up, a home, and so on. Its governing body, CFP Board, administers the credential. In 2017, CNN Money reported that jobs for CFP® professionals are expected to grow 30 percent over the next 10 years, making it an excellent career option for young financial professionals.
Requirements for Earning the CFP® Mark
The requirements for earning CFP® certification are:
- Complete a CFP Board-registered education program. CFP Board must be notified when you’ve completed it.
- Pass the CFP® exam. Offered three times a year in March, July, and November, the CFP® exam focuses on testing your financial planning knowledge in client situations. The topics covered include professional conduct and regulation, general financial planning principles, education planning, risk management and insurance planning, investment planning, tax planning, retirement savings and income planning, and estate planning. You should plan to spend 250 hours studying for the six-hour, 170-question, computer-based exam. This exam FAQ has more details.
- Hold a bachelor’s degree from an accredited university or college. You can hold the degree before you complete the education program and pass the exam or earn it afterward. (You have up to five years after passing to get your degree.)
- Have financial planning experience. This can be 6,000 hours of full-time, relevant personal financial planning or 4,000 hours of apprenticeship.
- Pass the CFP Board candidate fitness standards. To do this, you must agree to adhere to CFP Board’s ethical standards, disclose any criminal or employment termination history, and pass a background check.
For all the details about how to become a CFP® professional, check out this article.
CFP® Certification Benefits
Like the AAMS® designation, the benefits of earning the CFP® mark include a rewarding career that involves a relatively low investment ($7,000 for the course work plus exam fees) compared to the tuition for an MBA or other credentials. The most common careers include financial planner, wealth advisor, estate planning specialist, trading and research associate, financial consultant, financial representative, or financial analyst. If you want to become a branch manager at a financial firm, CFP® certification can help you achieve that level in your organization as well.
AAMS® vs. CFP® Mark: How to Choose
The AAMS® designation is respected as an achievement milestone. If you would like to quickly earn a credential to demonstrate your asset investment expertise to clients and employers, the AAMS® program takes less than three months to complete. If you are in training to become a personal financial planner, earning your AAMS® can put you on the path to an entry-level position.
The CFP® mark is highly respected in the industry, and it can open many doors for you in your career. Firms know that CFP® professionals are preferred by clients. In fact, a recent CFP Board study revealed that 69 percent of surveyed consumers said they would insist that their financial planners have the CFP® certification. As a result, many companies will offer financial assistance to employees interested in earning the CFP® mark.
As you ponder the benefits of each, ask yourself what your long-term goals are. If you would like to get a headstart in your financial planning career, earning the AAMS® designation is a good option. If your dream is to work in a large firm where you can apply personal financial planning knowledge and skills more broadly—and you have the time to invest in an intense program—the CFP® mark is an excellent choice.
Who Says You Have to Decide?
There is a third option: earning both the AAMS® and the CFP® mark. Many financial planners and advisors start with the AAMS® designation. Then, after gaining experience in the field, they enroll in the CFP® program and earn that credential. In fact, AAMS® designees receive credit for the completion of FP511 in the CFFP CFP® certification education program. This allows you to save both time and money.
Performing well in the AAMS® designation program and on the exam also increases your odds of passing the CFP® exam. A study by CFFP that was submitted to the 2019 Annual Meeting Academy of Financial Services shows that students who did well (either an A or B grade) in the AAMS® program had a good chance of doing well in the CFP® program. Testing out of two courses offered by CFFP and performing better in the CFP® program are two powerful arguments for earning your AAMS® before your CFP® mark.
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Free eBook: Is CFP® Certification Right for You?
Are you considering CFP® certification, but are unsure if you can handle it? Get a sneak peak at the beginning of the College for Financial Planning®—a Kaplan Company 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 FP 511: General Financial Planning Principles, Professional Conduct, and Regulation. It also includes several analytical problems that will allow you to apply your knowledge to real-life scenarios.