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What is a Certified Financial Planner™ ?
First things first, Steven Gerrish is not a Certified Financial Planner™ .. Yet.
It’s painful to start off a topic with such a negative statement, but it’s the truth of the matter as it stands today. If your financial planner can’t be upfront and honest you should find another financial planner, regardless of the acronyms after their name.
So the next question to be answered is “what is this CFP® thing I hear so much about?”. It’s a credential the financial services industry considers to the “gold standard” in identifying a planner that abides by and follows a specific set of criteria regarding financial planning. When starting the firm I recognized the importance of having this designation and began the journey to achieve it.
Realizing that a portion of the requirements are time and experience based, I set out to complete the requirements I felt had the most impact in providing quality financial planning to my clients. Specifically the educational and examination requirements.
I’ve included the information below detailing the requirements to achieve this designation. More information can be found at the CFP® boards website located here.
CFP® Certification Requirements
Education: CFP® professionals must develop their theoretical and practical financial planning knowledge by completing a comprehensive course of study at a college or university offering a financial planning curriculum approved by CFP Board. Other options for satisfying the education component include submitting a transcript review or previous financial planning‐related course work to CFP Board for review and credit, or showing the attainment of certain professional designations or academic degrees.
Examination: CFP® practitioners must pass a comprehensive two‐day, 10‐hour CFP® Certification Examination that tests their ability to apply financial planning knowledge in an integrated format. Based on regular research of what planners do, the exam covers the financial planning process, tax planning, employee benefits and retirement planning, estate planning, investment management and insurance.
Experience: CFP® professionals must have three years minimum experience in the financial planning process prior to earning the right to use the CFP® certification marks. As a result, CFP® practitioners possess financial counseling skills in addition to financial planning knowledge.
Ethics: As a final step to certification, CFP® practitioners agree to abide by a strict code of professional conduct, known as CFP Board’s Code of Ethics and Professional Responsibility, that sets forth their ethical responsibilities to the public, clients and employers. CFP Board also performs a background check during this process, and each individual must disclose any investigations or legal proceedings related to their professional or business conduct.
Once certified, CFP® practitioners are required to maintain technical competence and fulfill ethical obligations. Every two years, they must complete a minimum 30 hours of continuing education to stay current with developments in the financial planning profession and better serve clients. Two of these hours are spent studying or discussing CFP Board’s Code of Ethics or Practice Standards. In addition to the biennial continuing education requirement, all CFP® practitioners voluntarily disclose any public, civil, criminal or disciplinary actions that may have been taken against them during the previous two years as part of the renewal process. Learn more at www.cfp.net.