If you’re considering a flexible, intellectually stimulating finance career with high job satisfaction, financial planning is definitely within the top 5, in our opinion.
And one of the more prominent, internationally recognized qualification within this field is the Certified Financial Planner (CFP) designation.
If you’re considering the CFP exams, this guide covers exactly what you’ll need to do to obtain and earn the right to use the CFP mark in the US. For those considering CFP outside of United States, do refer to Financial Planning Standards Board’s (FPSB) website for your country’s unique requirements.
Let’s check it out!
CFP requirements in the US: The “4 Es”
To obtain a CFP certification in the US, there are some prerequisites to satisfy, aptly named the “4 Es”:
1. Education
Two required educational requirements:
- A minimum of bachelor’s degree in any subject from an accredited institution recognized by the U.S. Department of Education.
- International degrees may be used to meet this requirement if it received equivalency in an evaluation from a member of National Association of Credential Evaluation Services (NACES).
- This requirement can either be completed before passing CFP exam, or within 5 years of passing it.
- Complete financial planning coursework through an accredited CFP program, which includes the Capstone course. This coursework must be completed and verified before taking the CFP exam.
- You can bypass the coursework requirement if you have any of the following additional qualifications:
- Certified Public Accountant (CPA)
- Chartered Financial Analyst (CFA)
- Chartered Financial Consultant (ChFC)
- Chartered Life Underwriter (CLU)
- Licensed Attorney
- Doctor of Business Administration
- Ph.D. in Financial Planning, Finance, Business Administration, or Economics
- CFP certification from outside the U.S. from the Financial Planning Standards Board (FPSB) affiliate in your country
- Even in this accelerated path of getting the CFP coursework exemption, candidates would still need to complete a Capstone or Capstone Alternative course, as well as meet the remaining components of the “4 Es” requirement to become a Certified Financial Planner, i.e. pass the CFP exam, get the relevant work experience, proof of Bachelor’s degree at minimum and sign the Ethics declaration.
- You can bypass the coursework requirement if you have any of the following additional qualifications:
2. Exam
Pass the CFP exam: a one level examination, with a total of 170 multiple choice questions in 6 hours.
If only it was that easy. Check out our CFP exam section for more tips and guides on passing this exam.
3. Experience
There are 2 ways to complete the CFP work experience requirement:
- Complete either 6,000 hours of professional experience related to the financial planning process (“Standard Pathway“), OR
- 4,000 hours of apprenticeship experience that meets additional requirements (“Apprenticeship Pathway“).
You can log your experience as you go along and accumulate them during your career.
For both pathways, there are many ways to accumulate hours of experience:
- At the broadest sense, a qualifying CFP work experience involves delivering financial planning services to individual clients. Related family members or companies are excluded in the definition of clients.
- For Apprentice Pathway only, the 4,000 hours must be delivered via personally engaging with individual clients and under the direct supervision of a CFP professional.
- While Standard Pathway’s experience can also be accumulated this way, it is broader than Apparentice Pathway as the relevant experience hours could also accumulate through teaching, supervising, assisting with the financial planning process. Internships or Financial Planning Association (FPA) residency program that relates to the provision of financial planning services to individual clients would also count towards this.
- Experiences that don’t directly relate to the personal financial planning process, such as training, software development, marketing, training, corporate finance, administrative tasks etc should be excluded from the reported number of experience hours.
- The maximum relevant CFP experience hours one can accumulate is 40 hours a week. Assuming if a CFP candidate works full time and accumulates the maximum 40 hours of relevant experience a week, achieving 6,000 hours in the Standard Pathway would take around 3 years, at minimum.
The CFP work experience requirement must be fulfilled within 10 years before and/or 5 years after passing the CFP exam. If not, you’ll be required to retake the CFP exam to continue your path to CFP certification.
However, you may be able to request a one-off, 3 year extension granted on a case-by-case basis by contacting the CFP Board’s experience team at experience@cfpboard.org
4. Ethics
Sign CFP Board’s ethics declaration and pass the background check.
How do I get CFP certified?
Once you have completed the CFP requirements (Education, Exam, Experience and Ethics) above, you’ll need to make the following non-refundable payments to CFP Board to earn your CFP certification:
- A $200 application fee; plus
- A pro-rated amount of the standard $455 annual certification fee for your initial certification period.
You should receive an email once you make your payment confirming you are certified. Then, you can start using the CFP® or CERTIFIED FINANCIAL PLANNERTM marks. You will also receive a digital and hard copy CFP certificates in due course.
CFP renewal: maintaining your CFP certification
To maintain your CFP certification going forward, you’ll need to do these in order:
- complete 30 hours of continuing education (CE) every 2 years, which includes 2 hours of an approved Ethics CE course;
- submit an annual renewal application to confirm adherence to CFP Board’s Code of Ethics and Standards of Conduct;
- pay an annual certification fee (currently $455 a year).
If the CFP renewal application is not submitted on time, an additional $75 late fee is also applied.
If you decide not to renew and allow the CFP certification to lapse, this means that you can no longer use the CFP mark.
If a CFP certification has lapsed for 5 years or more, you’ll need to pass the CFP exams again to be reinstated. If it has lapsed for less than 5 years, you can reinstate it again via a reinstatement form, which includes a $100 reinstatement fee, reporting any outstanding CE, passing background check, completing another renewal application and paying the renewal fees.
Hope this summarizes the key steps on how to get your CFP certification in the US. Best of luck for your exams!
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