While others may call themselves financial planners, only
those who demonstrate the requisite experience, education, and ethical
standards are awarded the CFP® mark.
A CFP® agrees to adhere to a strict code of
professional conduct described in the CFP Board's Code of Ethics and
Professional Responsibility. You can review the Code of Ethics at
The following sites offer more information about CERTIFIED
What Is a CERTIFIED FINANCIAL PLANNER™ Professional?
A CERTIFIED FINANCIAL PLANNER™ professional or a
CFP® practitioner is a financial professional who meets the
requirements established by the Certified Financial Planner Board of Standards,
Inc. While others may call themselves financial planners, only those who
demonstrate the requisite experience, education, and ethical standards are
awarded the CFP® mark.
What are the requirements?
In order to obtain the CFP® mark, an applicant
- Hold a bachelor's degree from an accredited college or
- Complete a CFP® Board-registered education
- Pass the 10-hour CFP® certification exam
- Have at least three years of qualifying full-time work
experience in financial planning
- Pass a professional fitness standards and background check
Once appointed, a CFP® professional must meet
continuing education requirements every other year in order to maintain the
What does a CFP® professional do?
A CFP® professional is trained to develop and implement
comprehensive financial plans for individuals, businesses, and organizations.
He or she has the knowledge and skills to objectively assess your current
financial status, identify potential problem areas, and recommend appropriate
options. You're also working with someone who's demonstrated expertise in
multiple areas of financial planning, including income and estate tax,
investment planning, risk management, and retirement planning.
How is a CFP® professional compensated?
Typically, financial planners earn their living either from
commissions or by charging hourly or flat rates for their services. A
CFP® professional may use a combination fee-and-commission
structure: you pay a fee for development of a financial plan or for other
services provided by the CFP® professional, who also receives a
commission from selling you products. A commission is a fee paid whenever
someone buys or sells a stock or other investment, or when someone buys
insurance (such as health, life, or long-term care insurance) or annuities.
When calculating the cost to employ the services of a
financial planner, consider fees, commissions, and related expenses, such as
transaction fees and management fees related to the products he or she
How can a CFP® professional help you?
A CFP® professional can help you create a
personal budget, control expenses, and develop and implement plans for
retirement, education, and/or wealth protection. A CFP® professional
can offer expertise in risk management, including strategies involving life and
long-term care insurance, health insurance, and liability coverage. He or she
often can help with your tax planning or manage your asset portfolio based on
Specifically, a CFP® professional can help you:
- Establish financial and personal goals and create a plan
to achieve them
- Evaluate your financial well-being with a thorough
analysis of your assets, liabilities, income, taxes, investments, and insurance
- Identify areas of concern and help you address them by
developing and implementing a financial plan that emphasizes your financial
strengths while reducing your financial weaknesses
- Review your plan periodically to accommodate your changing
personal circumstances and financial goals
How to choose a CFP® professional
Selecting a CFP® professional is like choosing a
doctor for your financial health. Working with a CFP® professional
involves sharing very personal information and you will want to feel
comfortable with the professional you've chosen. He or she should be
knowledgeable, have integrity, and demonstrate a commitment to the highest
ethical standards in the industry. Also, a CFP® professional may
offer services to a particular clientele, such as small business owners,
corporate executives, or retirees, so be sure the planner you select works with
people whose interests and goals are similar to yours.
Before you choose someone to work with, ask around. You may
know a family member, friend, or colleague who has worked with someone they'd
recommend. Also, be prepared to interview the prospective CFP®
professional. At your meeting, request a copy of form ADV or the comparable
state form. A CFP® professional who offers investment advice for a
fee is required to file form ADV with the U.S. Securities and Exchange
Commission (SEC) or with the state of residence of the CFP®
professional (although some exceptions apply). Form ADV contains information
about the professional's education, business, disciplinary history, services
offered, fees charged, and investment strategies. In addition to form ADV, ask
for the disclosure document that contains other important information regarding
the CFP® professional. Even if you don't ask for the disclosure
document, it must be provided to you at the time you enter into an agreement
for services, or soon thereafter. Be sure to read the disclosure document
carefully as well as any written agreements you enter into.
Questions to ask
Here are some questions you may want to ask a
CFP® professional to help you find the right planner for you:
- What is your education? What schools did you attend and
what degrees have you earned?
- What licenses do you hold? Are you registered with the
SEC, FINRA, or the state?
- Are you affiliated with any professional groups or
organizations? Do you execute securities trades through a broker-dealer? Who is
- Does your practice concentrate in a particular area? What
types of clients do you work with?
- What type of products and services do you offer? Are you
limited as to the products and services you can offer me?
- How are you compensated for your services? Do you receive
a commission for products you may sell to me?
- Have you ever been disciplined by any government board or
Is a CFP® professional right for you?
The financial world has become a very complex place. Even if
you're used to handling your own financial affairs, the time may be right to
consult a CFP® professional who can review your financial health and
offer suggestions that may help you reach your financial goals.
For example, are you familiar with all the different
investment opportunities that might be available to you? Are you on track to
meet your financial goals such as saving for your child's college education,
securing enough income for a comfortable retirement, or protecting your assets
against risks and lawsuits? A CFP® professional can offer the
analysis you need to help answer these and other important financial questions.
Certified Financial Planner Board of Standards Inc.
owns the certification marks CFP® and CERTIFIED FINANCIAL
PLANNER™ and federally registered CFP (with flame design) in the
U.S., which it awards to individuals who successfully complete CFP Board's
initial and ongoing certification requirements.