16 Jan 2014

What is a Certified Financial Planner

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It’s one thing to know, for example, that the “C” in CFP® stands for “Certified.” But it becomes a lot more meaningful when you find out that the certification comes from non-profit CFP Board, whose mission is to benefit the public by upholding it as the recognized standard of excellence for financial planning. It achieves this by qualifying professionals through education, extensive examination, years’ of experience in financial planning, and continuing education requiring commitment to a professional code of ethics and practice standards.

The meaning of “C-F-P” becomes even more powerful when you learn that CFP Board’s certification process has itself been certified by the International Organization for Standardization. And a CFP® professional is subject to enforcement actions by CFP Board if found by a disciplinary panel to have violated an ethical principle or practice standard.

CFP® Certification requirements include:

Education: Unlike many financial advisers, CFP® professionals must develop their theoretical and practical knowledge by completing a comprehensive course of study approved by the CFP Board.

Examination: CFP® professionals must pass the comprehensive CFP® Certification Exam, which tests their ability to apply financial planning knowledge to real-life situations. The exam covers the financial planning process, tax planning, employee benefits and retirement planning, estate planning, investment management and insurance. The average pass rate for this difficult exam is only 56%.

Experience: Certified Financial Planner professionals must have a minimum of three years’ experience in the financial planning process prior to earning the right to use the CFP® certification marks.

Ethics: CFP Board’s Code of Ethics outlines CFP® professionals’ obligation to uphold principles of integrity, objectivity, competence, fairness, confidentiality, professionalism and diligence. And the Rules of Conduct require CFP® professionals to put your interests above their own and to provide their financial planning services as a “fiduciary” – acting in the best interest of their financial planning clients.

Enforcement: A CFP® professional who violates CFP Board’s ethical and practice standard becomes subject to disciplinary action up to the permanent revocation of certification. Through diligent enforcement of its ethical and practice standards, CFP Board provides you with the confidence that your CFP® professional is both competent and ethical.

What designations does your advisor have? Check out the “Meet the Team” section of our website to see what designations our team members have & how those benefit you as a client!

Have a great day! Maren

Source Information: CFP Board

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About the Author
Maren Aipperspach


Vice President, CCO, CFP, Maren, a Certified Financial Planner, is highly experienced in marketing, research and money management... Read Full Bio >