A Certified Financial Planner™, or CFP®, undergoes rigorous education and training in order to obtain the CFP® designation. In order to receive the designation of CFP®, a person must obtain a bachelor’s degree from an accredited college or university and complete a program in personal financial planning. In addition, the CFP® board requires candidates to complete secondary education in major areas of financial planning, covering subjects such as planning for education expenses, planning for tax season, and managing investment portfolios.

The CFP® board also requires potential financial planners to complete an exam comprised of 170 multiple choice questions spanning over two 3-hour sessions. The goal of the exam is to measure the tester’s ability to think critically and solve problems rather than strictly fact recollection. The pass rate for the exam is around 60%.

In addition to the exam, a prospective CFP® must report to the CFP® board a minimum of 6,000 hours of qualifying professional experience, or a minimum of 4,000 hours as part of an apprenticeship program. As an apprentice, all experience must be gathered under the direct supervision of a CFP®. While it is required that you obtain a bachelor’s degree prior to obtaining the CFP® designation, it is not a requirement to hold a bachelor’s degree to take the exam. However, once the exam has been passed, a bachelor’s degree must be obtained within 5 years of the exam date, without equivalency or exception.

The final requirement for initial CFP® certification involves completing a CFP® certification application with the CFP® board,during which the hopeful CFP® will be asked to disclose information about his or her past and background, including involvement in any criminal, civil, government, or agency proceedings. The CFP® board conducts a thorough background check on applicants before giving the CFP® designation.

The CFP® board has strict and detailed requirements for ethical considerations when allowing a person to use the designation of CFP®. The CFP® board defines and outlines conduct that is unacceptable and will always bar a person from becoming a CFP®, as well as conduct that requires special consideration from the CFP® board before awarding a designation to a candidate.

The following criteria are considered to be unacceptable and will always prevent a person from becoming a CFP®:

  • Conviction for theft, embezzlement, or other financially motivated crimes
  • Conviction for tax fraud, tax evasion, or other tax-related crimes
  • Revocation of another financial professional license unless the revocation is administrative, such as revocation for non-payment of annual fees
  • Conviction for murder or rape, or conviction for any violent crime within the past 5 years.

Additionally, the CFP® board presumes the following to disqualify a candidate from becoming a CFP®, but special consideration can be given if the Commission is petitioned:

  • Two or more bankruptcies, either business or personal
  • Revocation or suspension of a non-financial professional license, such as a Realtors license, unless the revocation or suspension is administrative in nature
  • Suspension of a financial professional license, such as insurance or securities, unless the suspension is administrative in nature
  • Felony conviction of non-violent crimes within the past 5 years
  • Felony conviction of violent crimes that occurred more than 5 years ago

In short, the requirements for initial CFP® certification are what’s known as “the four ‘E’s”; education, examination, experience, and ethics. Once the requirements for initial certification have been met, the CFP® designation will be granted to the applicant by the CFP® board.

Once the CFP® board has granted the designation, a CFP® is then required to undergo continuing education to maintain the designation. The requirement for continuing education is 30 hours every 2 years, which includes 2 hours of ethics education.

The continuing education program must meet criteria defined by the CFP® board in order to be accepted for renewal of the CFP® designation. All CFP® continuing education programs must address one or more of the eight principal topics defined by the CFP® board, contribute to professional competency, and be current and accurate.

A CFP® that needs to fulfill their continuing education requirement may also choose to participate in a self-study program, take college-level courses as long as the courses meet the other requirements set by the CFP® board, or fulfill a percentage of their hours by teaching or authoring original scholarly work.

Documentation for continuing education must be kept by the CFP® for a minimum of three years. Misstating or fraudulently reporting continuing education may cause the CFP® board to enact disciplinary action, up to and including revocation of the CFP® designation.