Hey there, welcome to this detailed guide on the CFP exam.
By the end of this article, you will have known all there is to know about this exam, its requirements, registration costs, expectations, and how to prepare for this exam.
This article covers the following in detail:
Let the preparations begin!
The CFP Exam Requirements
In your journey to becoming a CFP professional, one of the most challenging areas of the whole process is the CFP exam.
It is a comprehensive exam by the Certified Financial Planner Board of Standards, Inc. that will test how capable you can apply your financial planning knowledge to real-life scenarios.
You must meet the CFP Board’s education requirements for successful exam registration.
Passing the exam is the main goal and a major determiner of whether you will become a CFP or not.
There are CFP exam requirements that you must first fulfill as a candidate before you are allowed to take the exam.
You must first fulfill the CFP Board’s education requirement as a candidate.
You can do that by either enrolling in a CFP Board Registered program or simply completing the relevant coursework, which must be verified and reviewed by the board.
Complete the education requirement
The CFP Board registered programs have a curriculum that offers the 72 Principal Knowledge topics that you must learn to successfully fulfill the coursework requirement, to allow you to sit for the CFP certification examination.
After completing these CFP registered programs, you must submit an education verification to the CFP board, which will allow you to sit for the exam.
You have the option to register for the CFP EXAM even before attaining the certification coursework requirement.
But, remember that the CFP Board should receive coursework completion verification documents before the education verification deadline.
In case there is a delay and verification is not sent to the board on time, your exam registration becomes invalid, which will cost you $250 as a postponement fee.
If you also fail to register within the next two exam administrations, you will lose the chance to sit for the exam.
No Bachelor’s degree required
Bachelor’s degree is one of the relevant education requirements for a certified financial planner.
However, the CFP board does not require you to hold a bachelor’s degree before sitting for the CFP exam.
However, you must earn that bachelor’s degree and fulfill this education requirement within 5 years after passing your CFP exam.
Proof of previous relevant education
In some instances, you might have covered various coursework content areas after taking on educational courses that aren’t part of the CFP Board registered program.
In this case, you can still sit for the exam, but you must submit your course transcripts.
Only after the board approves that you qualify for the CFP exam will you sit for that exam.
Professional designations and credentials
You can sit for the exam if you happen to possess some professional designations, academic degrees, or any relevant credentials.
The CFP Board can look at these and allow you to take the Accelerate Path to CFP certification.
If you happen to hold any of the following approved professional designations, you can take an abbreviated Capstone Alternative program instead of full educational coursework.
- Ph.D. in Business, Finance or Economics
- Doctor of Business Administration
- Chartered Financial Consultant
- Chartered Life Underwriter
- CFP from the FPSB
- Certified Public Accountant or Licensed Attorney
The CFP Board approves these registered education programs, but it doesn’t offer the education itself, and neither does it express any opinion on providers.
It is up to you as the candidate to do your research and choose the best CFP education provider.
The CFP Exam Registration & Costs
The exam is available 3 times annually across 8-day testing windows, which happen in March, July, and November.
You can select your test day and exam location during registration.
There is a standard registration fee of $925.
You can take advantage of the early bird rate of $825, valid 6 weeks before the registration deadline.
If you are late in your registration which means two weeks before the deadline, you will pay a rate of $1025.
Registering for the exam can be done through the CFP Board online or via phone upon completing your education program coursework.
According to the CFP board, the testing appointments are booked with Prometric in the order of time of registration.
The Board recommends that candidates register for this exam as early as possible to secure the best date and site availability.
CFP Exam Policies On Rescheduling & Cancellations
There are policies regarding exam rescheduling and cancellation, and they are as follows:
If you postpone your CFP exam, you will incur a postponement fee of $250.
You will be allowed to postpone your exam only once per every registration.
You should book your next exam appointment within the next two exam administrations.
Remember, the deadline for postponement should be strictly 5 days before day one of the exam windows.
Suppose you are registered with the CFPBoard and have submitted all the requirements, such as paying exam fees and completing education verification, but you haven’t scheduled the Prometric appointment.
In that case, you only have until 5 days before the exam begins to secure your exam slot.
If you haven’t scheduled your exam before the deadline, then automatic deregistration will occur, and you will still incur a postponement cost of $250.
A withdrawal request
If you decide not to sit for the exam and have already registered, you will be entitled to a refund of $200.
Just make sure that you make your withdrawal request 5 days before the exam begins.
Medical or other emergencies
If you have medical or other emergencies, the CFP Board will consider waiving your fee forfeiture.
You must request this waiver in writing and attach supporting documentation from a third party for verification purposes.
You must submit this request within 10 business days after the exam window closes.
The “no show”
If you fail to show up for the CFP exam, there is not much you can do except you will automatically forfeit the entire exam fee.
Preparing For The CFP Exam
The aim of preparing for this exam is to pass it.
Passing the CFP exam means that you will be closer to becoming a certified financial planner, one of the most elite financial planning designations.
When preparing for the exam, you will note that there is too much to learn, and you must understand everything to relate and apply it to the case studies.
There are a lot of CFP exam preps, flashcards, and CFP study materials that aid you in preparing for the exam.
You can purchase CFP Study guides to get a feel of the CFP exam format and assist with your exam preparation.
Also, you may want to enroll in one of several review courses that will help you get a grasp of the CFP coursework and how to pass the CFP exam.
Make sure you have enough study time and have a great study plan to ensure that you cover everything by the time you sit for the exam.
According to the CFP Board, candidates should spend at least 250 hours studying for this exam.
Here are some exam study tips to keep in mind:
- First, choose the best time for you to take the CFP exam.
- Create a convenient study schedule that also incorporates life events
- Study as if you are preparing for a marathon and have the necessary breaks
- Ensure you verbalize the concepts you study
- Seek help where necessary
- Do as many practice questions as possible to familiarize yourself with exam questions.
- Create your practice exam as you study
- Do a test drive to the exam site.
- You don’t need to be an “A” student, just pass the exam.
Remember that the exam is a computerized 6-hour session that entails 170 multiple-choice questions to test your financial planning knowledge in real-life client scenarios adequately.
The exam is administered in two 3-hour sessions with a 40-minute break between the two sessions.
CFP Exam Day Tips
The exam day is the most important.
By this time, you either studied hard or didn’t.
A good night’s sleep the night before an exam is important.
Arrive at the exam testing center 30 minutes before the exam time.
Come with all the relevant identification documentation, such as a valid government-issued photo ID.
You might also want to carry packed lunch or snacks to take during the 40-minute break.
Of course, you don’t want to go out of the exam center for lunch and risk coming late because the exam clock will begin ticking whether you are settled in or not.
As you do the questions, pace yourself and know how much time you should spend on each question.
In the end, pass the exam and become that elite financial professional.
The CFP ExamTopics
There are 72 knowledge topics covered in the exam about the exam topics.
They are structured into the following structures.
- General finance planning principles
- Retirement Savings & Income Planning
- Investment Planning
- Risk management and insurance planning
- Tax Planning
- Estate planning
- Education planning
- Professional conduct & regulation
It is important to note that the exam questions are created by people in the industry, with the test experts overseeing the whole process.
CFP Exam Passing Score
This is a pass-or-fail exam whose passing score is determined via a psychometric process that determines a candidate’s minimum competency to be a certified financial planner.
The test experts ensure that, in the end, the test takers who pass the exam are competent across all the Principal Knowledge Topics.
The CFP exam scoring process can seem frustrating to the test takers because there is no set score that you need to pass.
After taking the exam, you will determine whether you passed or failed.
If you failed, you would see the areas where you scored low.
If you fail and need to retake the exam, you will do it in the next testing window.
You must also pay the exam fee and take the entire exam for each retake.
You can take the exam three times in 24 months.
You also have the opportunity to take the exam a maximum of five times and no more.
Becoming a certified financial planner is undoubtedly the gold standard in the financial planning industry.
If you are serious about your finance career and want to stand out from the masses, then being a CFP is the way to go.
But it is not a cakewalk because of the rigorous process involved and the CFP exam, which is a hurdle on its own.
Still, the CFP exam pass rate is usually more than 50% which means many candidates who take this exam pass and become certified financial professionals.
You could be one of them too.