FAQ: How Long Does It Take To Become a CFP?

By Indeed Editorial Team

Published March 29, 2021

As a financial planner, you are responsible for helping your clients organize their financial futures. With a certification, you can improve your skills in this profession by undergoing specialized training in your industry and testing your knowledge of taxes, insurance and other fundamental topics. To pursue your CFP certification, it's important to understand what education and training the Certified Financial Planner Board of Standards (CFP Board) requires and how long it may take you to complete the entire process.

In this article, we discuss how to prepare for the CFP exam, the benefits of becoming certified and how long it takes to become a CFP.

Related: Financial Planners vs. Financial Advisors: Here's What You Need To Know

What is a CFP?

A certified financial planner (CFP) is a professional who counsels clients through major financial decisions, including:

  • Preparing for retirement

  • Buying a home

  • Starting a business

  • Paying for college tuition

  • Making a business investment

  • Paying taxes

  • Enrolling in insurance

Certified financial planners work in a variety of professional settings, such as:

  • Banks

  • Insurance agencies

  • Investment firms

  • Credit unions

Related: Top 11 Finance Certifications To Enhance Your Expertise

What education does a CFP need?

An aspiring CFP needs to complete a CFP Board-registered education program, which colleges and universities offer. Once you complete the program, the next step is to notify the CFP Board to receive credit. The education program prepares you to provide financial counseling to clients.

However, you may not need to enroll in a Board-registered program if you have one of the following credentials:

  • Licensed attorney

  • Doctor of Business Administration

  • Ph.D. in Financial Planning, Finance, Business Administration or Economics

  • Certified Public Accountant

  • Chartered Life Underwriter

  • Chartered Financial Analyst

  • Chartered Financial Consultant

  • CFP Certification from outside of the United States

To become a CFP, you also need a bachelor's degree from an accredited university. You must have earned the degree before taking the CFP exam or within five years of passing the exam. The CFP Board requires no particular discipline for your bachelor's degree.

Related: How Much Do Financial Advisors Make?

What work experience does a CFP need?

Along with the education requirements, a CFP needs 6,000 hours of relevant experience in the financial planning field or 4,000 hours of apprenticeship experience under the supervision of a licensed CFP professional. The CFP Board requires you to have experience that shows you can provide financial planning independently, and you can get this experience in a variety of ways. For example, you could get an internship, participate in the Financial Planning Association Residency Program, support or supervise the financial planning process, teach classes related to financial planning or work with clients directly.

The CFP Board may want to know that you can successfully:

  • Build a professional relationship with the client

  • Collect information about the client and their financial goals

  • Evaluate the client's financial status

  • Make recommendations for financial planning

  • Enforce the recommendations

  • Monitor the recommendations

How long does it take to become a CFP?

How long it takes to become a CFP depends on your education and level of experience. Here are examples of time periods that may apply to you:

  • Less than one year: If you have a credential that exempts you from completing the board-registered program and you have three years of financial planning experience, you are immediately eligible to take the CFP exam. You may need a few months to prepare for the exam and receive your results.

  • At least three years: If you have a qualifying educational credential with no industry experience, you may need to work at least three years in a financial planning role before you take the CFP exam.

  • At least five years: If you don't have qualifying education credentials, you may need at least one year to complete the board-certified program and at least four years to earn a bachelor's degree. You would also need an additional three years of financial planning experience, unless you work in the field while you're in school.

What does the CFP exam cover?

The CFP exam has a total of 170 multiple-choice questions separated into three sections: case studies, short scenarios and stand-alone questions, all of which test your ability to apply financial planning principles to real-life scenarios. Here are the topics the exam covers:

  • Professional conduct: This section tests your knowledge of the laws that protect your clients and ethical guidelines you need to uphold as a CFP.

  • General financial planning principles: You may need to apply knowledge about managing debt and cash flow and communicating with clients through the financial planning process.

  • Education planning: How to save money to fund college education and financial aid are components of education planning.

  • Estate planning: You may need to know how to transfer property and what estate planning documents entail. This section may also include estate planning for relationships, such as marriage.

  • Tax planning: The exam may test your knowledge of tax law, income tax or minimum tax. You may also need to know how tax deductions work in charities or philanthropic endeavors.

  • Investment planning: In this section, you may apply your comprehension of investment risk and different investment strategies, as well as how to measure investment returns and build investment portfolios.

  • Retirement planning: Topics such as Medicaid, social security and the types of retirement plans may appear in this section.

  • Insurance planning: You may need to know the fundamentals of life, health and disability insurance. The section may also test you on how businesses use insurance.

What are the benefits of becoming a CFP?

The benefits to becoming a certified financial planner include:

  • You stand out as a job candidate: When you apply for positions as a financial planner, having your certification can show employers that you're qualified to provide financial counseling to clients and you've completed the comprehensive training that the CFP Board requires.

  • You strengthen your financial planning skills: Taking the coursework of a board-registered program and gaining experience in the industry can allow you to learn more about financial planning and how to best meet your clients' needs.

  • You can advance in your career: With your CFP Board certification, your employer may offer opportunities to work with more clients or expand the financial counseling you provide.

  • Your clients may perceive you as more trustworthy: Informing your clients that you're a certified planner can help you establish trust with them, and they may view you as a credible resource to make recommendations.

Related: Guide To 20 Types of Financial Advisors (With Salaries and Duties)

What are some tips for becoming a CFP?

Consider following these tips to pursue a career in financial planning:

  • Connect with other aspiring financial planners. By building a network of professionals, you can share tips for pursuing the CFP certification and learn about employment opportunities in the field. Consider joining the Financial Planning Association (FPA) or the National Association of Personal Financial Advisors (NAPFA).

  • Find a mentor. A mentor who has undergone the CFP certification process can offer guidance on studying for the CFP exam and completing the board-registered program. You can also learn how to search for a CFP position after you become certified.

  • Attend conferences. Attending a national or regional conference can help you expand your network and build your financial planning skills.

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