What is a CFP?

Picking a Financial Planner—DO YOUR HOMEWORK!

Make no mistake—literally any financial practitioner these days can (and often does) call himself or herself a “financial planner.” But don’t be fooled. Choosing a financial planner is a critical decision you make for yourself, your family, and/or your business. Financial planners can provide specific advice or work with you on analyzing more long-term financial goals. It is critical to “do your homework” and take the time to select a competent and trustworthy financial planner as if your future depends on it. After all, it does.

CFP®, CERTIFIED FINANCIAL PLANNER™ and are certification marks owned by Certified Financial Planner Board of Standards Inc. (CFP Board). These marks identify financial planners who have pledged to be committed to competent and ethical behavior when providing financial planning. CFP Board-certified planners have undertaken great efforts to illustrate their professionalism by voluntarily submitting to the rigorous CFP® certification process. This process consists of requirements of education, examination, experience, and ethics. Only those who have undertaken this level of commitment and professionalism as determined by the Certified Financial Planner Board of Standards, Inc. can display these marks.

Education: CFP® professionals must complete a comprehensive college or university course of study that offers a CFP® Board-approved financial planning curriculum. The education requirement can also be satisfied by submitting a transcript or prior financial planning-related course work to the CFP Board for review and credit, or by attaining certain professional degrees or designations.

Examination: CFP® practitioners must pass a comprehensive two-day, 10-hour CFP® Certification Examination that measures their ability to apply financial planning concepts and knowledge in an integrated format. The examination covers the financial planning process, tax planning, employee benefits and retirement planning, estate planning, investment management and insurance.

Experience: CFP® professionals must have a minimum of three years of financial planning experience before meriting the right to use the CFP® certification marks (or, effective September 2012, two years of personal delivery experience that meets additional requirements). Thus, CFP® practitioners must display financial counseling skills in addition to having substantive knowledge of financial planning.

Ethics: Finally, CFP® practitioners pledge to adhere to a strict ethical code, known as CFP Board’s Code of Ethics and Professional Responsibility. This code enumerates ethical responsibilities to the public, clients and employers. A background check is also performed by the CFP Board during this process, and each individual must disclose any investigations or litigation related to their professional conduct.

The Code of Ethics requires CFP® practitioners to act fairly and diligently when providing you with financial planning advice and services, putting your interests first. The Code of Ethics states that CFP® practitioners are to act with integrity, offering you professional services that are objective and based on your needs. They are required to provide you with information about their sources of compensation and conflicts of interest in writing.

Once certified, CFP® practitioners are required to complete a minimum 30 hours of continuing education to stay current with financial planning developments and better serve clients every two years. This includes continuing education hours spent studying or discussing CFP Board’s Code of Ethics or Practice Standards. In addition to the 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.

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