Taking the steps to become a Certified Financial Planner (CFP) is smart to designate yourself from the roughly 800,000 other advisors in the financial services field. CFPs are highly trained and specialized finance professionals who assist individual or corporate clients in choosing the best investments, insurance, retirement plan, and other financial products. Certified Financial Planners meet with clients regularly to create budgets, give advice on investing, monitor their portfolio, and discuss any fiscal troubles. As the baby boomers approach retirement, there’s expected to be a growing demand for financial planning and overall job growth skyrocketing by 27 percent before 2022, according to the Bureau of Labor Statistics. To fulfill one of the estimated 60,300 new jobs, follow this step-by-step guide for becoming a Certified Financial Planner.
Obtain a Bachelor’s Degree
Before you can apply for the Certified Financial Planner credential, you’ll need to attend an accredited business school to achieve a four-year bachelor’s degree. Although most choose to major in finance, financial planners can also benefit from a background in accounting, business administration, economics, mathematics, or even marketing. The trick is to attend one of the 300 U.S. colleges and universities that offer the minimum 15-hour CFP exam prep curriculum. This is essential in making sure you know the major financial planning topics addressed on the examination.
Acquire Experience and Licensing
Earning the designation of Certified Financial Planner indicates that you have the ability to give good financial advice without supervision. For that reason, you’ll need to have at least three years of work experience in personal financial planning with direct client support practice. One of the best ways to start meeting this requirement is to complete an internship or apprenticeship while earning your bachelor’s. If your entry-level position involves directly buying or selling investing products, remember that you’ll need to become licensed through the Securities and Exchange Commission (SEC) too.
Consider Attending Graduate School
Although this step isn’t yet required, many financial planners benefit from returning to graduate school to obtain their master’s degree. It’s advantageous for CFPs to earn a Master of Science in Finance (MSF), Master of Business Administration (MBA), or a similar degree. Graduate-level education will help you move into senior management positions and attract new clients in financial planning. Master’s programs can take anywhere from one to three years. Attending an accredited online business school will likely be best to continue working full-time.
Pursue Professional CFP Certification
Last but certainly not least, you’ll need to pursue the Certified Financial Planner credential by passing the exam hosted by The CFP Board. A recent survey found that 85% of financial planners found completion of the certification exam to be “very important” for career success. After completing an online account, you can register for the paper-based or computer-based CFP exam at multiple times each year across the United States. Passing questions in eight domains will be required. Since the CFP exam has a pass rate of 55%, make certain you review the online study materials very carefully.
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Financial planning plays an important role in helping people meet their monetary goals with enough funding for a happy, comfortable life. Job opportunities may be growing, but you’ll still have to prove your professional capability in this coveted role to successfully drum up clients. Most financial advisors do this by earning the CFP credential. Once you become a Certified Financial Planner, you’ll have the freedom to work in banks, insurance companies, investing firms, corporations, and brokerages or fly solo with your own independent practice.