Hi there, welcome to this informative article on how long to become a CFP.
After reading this article, you will understand the different paths to become a CFP and how long it takes to fulfill them.
In this article, we will cover:
Let’s get started!
How Long To Become a CFP – A Quick Intro
It is imperative to understand what it takes to be a certified financial planner, the process of acquiring CFPcertification, and how long it will take you.
It is not easy because there are many education requirements and continuing education requirements to meet.
These take time.
Still, financial professionals make it and become Certified Financial Planners.
Becoming a certified financial planner requires commitment and basic qualifications to complete the CFP certification process.
However, without the passion for becoming a CFP professional, consistency, and love for the job and the course, it might prove to be the most difficult of tasks ever.
The first step to becoming a CFP is completing a CFP Board registered education program offered by accredited institutions such as the Kaplan Insitute and others.
However, there are exceptions to this requirement that’s if an individual possesses one of the following qualifications;
- Certified Public Accountant (CPA),
- Chartered Financial Consultant (ChFC),
- Licensed Attorney, or
- holds a doctorate in business administration.
The coursework may take between twelve to eighteen months to complete.
Let us look at how long it will take for each step that brings you closer to becoming a CFP.
Education Requirements and Duration
Immediately after completing the education program, you must notify the CFP Board of your program completion, which many institutions can help you with.
Earning A Bachelor’s Degree
The CFP board of standards requires all certified learners possess at least a bachelor’s degree from an accredited institution.
You don’t have to earn the degree beforehand, as there is a five-year grace period to earn the degree after the registration of the CFP exam.
However, failure to earn the required bachelor’s degree within the given time leads to the cancellation of the registration.
Even though the Board does not require one to hold a bachelor’s degree in a specific field, it gives mandatory requirements that align with the Board’s significant financial planning areas.
If the requirements are not met in your bachelor’s degree, you can always source them outside your bachelor’s program.
If you don’t have a bachelor’s degree and are still interested in practicing as a financial planner, pick a program in line with the Board’s requirements to avoid missing out on the vital components of the coursework.
A bachelor’s degree takes 4 years to complete.
How Long Should You Study for the CFP Exam?
Immediately after meeting all the requirements put in place, including completing the coursework by attending CFP classes (certificate program), one is expected to apply for and sit for the CFP exam.
The exam has 170 multiple-choice questions divided into three parts; case studies, stand-alone questions, and short scenario questions.
The exam is offered three times a year: the months of March, July, and November, in eight days for each of the three months provided.
It is administered in two 3 hours sessions separated by a 40 minutes break.
The good news is that one can always take a retake at an extra rescheduling cost.
Due to the massive failure rate of the first-time trials, the Board requires candidates to take a CPF exam prep-course to prepare for the main CFP exam fully.
The exam costs $825 for registration and an additional $100 if you register after the grace period.
The exam covers various topics; It is always advisable to prioritize the multiple-choice questions as they are easier to answer.
The CFP pass rate is meager, with as many as 67% of candidates enrolled passing.
You will need some good study hours to study the crucial exam topics.
Dedicate around 250 hours of study to pass this exam.
This is the equivalent of a few days of rigorous studying for the exam.
Work Experience Requirement Process
As part of the certification requirements, candidates are also expected to acquire years of experience, as discussed below, to be presented with the proof of coursework completion.
More processes are involved after you fulfill the education requirements.
These processes fulfill the experience required to become a CFP.
Immediately after graduation with a bachelor’s degree in any of the other education requirements, an individual is expected to pursue an entry-level financial planner job.
The Board requires that the individual possess significant real-life experience before getting rewarded with their CFP credential.
It is expected that the candidate will take between 4000-6000 hours of their time to gain work experience.
You must obtain this experience from working with skilled and experienced financial professionals in the industry, such as working with a senior chartered financial analyst to gain professional experience.
Activities unrelated to personal financial planning processes such as marketing, administrative duties, app development, etc., do not qualify as work experience.
But, if your activities involve estate planning, retirement planning, insurance planning, investment planning, etc., they qualify as work experience.
You can choose to fulfill the experience requirement through either the standard pathway or the apprenticeship pathway.
The Standard Pathway
This pathway works in a system that assumes you are earning your experience in your line of duty as you provide services to the clients in need.
It may also assume that you are acting in another role related to the field, either as an independent financial advisor or representative advisor of a more prominent firm.
The experience can involve supervision, direct support, and even coursework teaching.
However, you can acquire experience through a few activities, but it contains a minimum of one of the seven individual financial planning processes components.
Overall, you need to work for 6000 hours to amass vast experience.
In this pathway, the experience is profoundly and carefully manned and controlled.
It also requires an accumulated 4000 hours to gain the required experience – sometimes this can be up to 2 years or more.
In the apprenticeship pathway, you’re expected to cover all the seven elements without failure, and you must earn it through the personal delivery of services to clients.
This is also supposed to be done under the direct supervision of a current professional in Certified financial planning with certification from the Board.
The CFP board may be interested in knowing the following about the individual.
- They need to know whether a candidate is capable of building a professional relationship with the client and if they can collect financial information from the client and evaluate it appropriately.
- The candidate must make the recommendation, enforce, and monitor the client’s financial planning activities.
You can only gain apprenticeship experience through the supervision of a senior certified financial planner.
The Background Check Process
All the CFP applicants who require certification must pass the CFP Board candidate fitness standards, including the code of conduct.
The CFP is regarded as a high profession due to this aspect of it being held to higher professional standards than other fields.
You’re expected to adhere to the Board’s code of conduct and ethics, professional responsibility, and financial planning practice standards.
The background check could take a few days.
Immediately after completion of the background check by the Board, you’re to pay a one-time additional non-refundable fee of $100 for the background check.
Additionally, you will also be required to pay a certification fee of $360 every two years.
Continuing Education Process
Passing the given exam is not the end of the road for the CFP applicant.
You’re further expected to satisfy the advanced education requirements after every two years to keep your credentials updated.
The requirements consist of 28 hours from either of the approved subject topics, a minimum of one or more, 2hours from a CFP Board-approved program on standards of professional conduct.
It is your responsibility to know where and how to acquire advanced education to satisfy the requirements.
It would be advisable as a CFP professional you use suitable study materials and acquire the relevant additional credentials to advance your financial careers further.
The advanced CFP education program comes with the advantage that it keeps you updated on the emerging issues in the sector.
It also offers solutions and clarity on dealing with the issues appropriately, not to mention the experience gathered.
Attaining the prestigious title of a Certified Financial Planner is not as easy as it seems this is evident, as discussed above.
The process takes a good amount of commitment and time for anyone willing to earn it and meet all the certified financial planner board of standards requirements.
Take 4 years of earning a bachelor’s degree, a few months of the CFP program.
Note the time it takes to acquire all these credentials, but in the end, your CFP certification is your CFP license to carry out all your financial planning activities for your future clients.