The Certified Financial Planner (CFP) exam is one of the most challenging financial planning exams. In 2023, more than 9,800 candidates took the exam, but only 64% succeeded.
The number of CFP® exam-takers is increasing. According to a post-exam survey, the 2023 season saw the highest number of candidates.
Why take the CFP exam?
The CFP post-exam survey shows that ‘demonstrating expertise’ is a key reason individuals took the CFP exam. At least 78% of them said they wanted to have a career as a financial planner to prove their expertise, and around 66% dreamed of becoming an expert fiduciary.
Today, the US has over 330,000 financial advisors, and only around 93,000 are CFPs. However, most organizations and individuals trust a CFP when it comes to managing finances. In addition to in-depth knowledge, the professional is recognized by the public, firms, and advisors.
Around 86% of consumers believe hiring a certified financial advisor is better than someone who hasn’t passed a certification exam. Also, 81% think an advisor should be one who can handle all aspects of their financial affairs.
With a CFP certification, you can help people make financial decisions.
Top reasons to take the CFP exam:
Most financial institutions, firms, and individuals trust CFP-certified professionals for their financial decisions.
The US has over 10,000 organizations with CFP-passed employees.
The CFP certification is the gold standard of the financial planning profession.
So, if getting your CFP certification is so important, why don't more people do it? Quite simply, the CFP exam is extremely challenging. The CFP board recommends studying for 250 hours. That's a huge commitment! It's also why CFPs are so highly regarded in the industry.
Here at Nissim Tutoring, we believe in studying smarter. By focusing your time and energy, you can learn more and avoid putting in countless, useless hours. So let's get into the top tips for passing the CFP exam.
What is the structure of the CFP exam?
What is the structure of the CFP exam?
✔ Is six-hour long (computerized)
✔ Has 170 multiple-choice questions
✔ Divided into two sessions (each session of 3 hours)
✔ Includes a mandatory 40-minute break in the middle
What material is on the CFP exam?
✔ Tests your understanding of financial planning in the real world
✔ Although the test is related to finance, you can only use a non-programmable financial calculator.
✔ The CFP Board provides the essential formulas and tax tables required for the exam.
What topics does the CFP exam cover?
The exam checks your ability to apply the fundamentals of financial planning to real-world situations. That's why you can't just memorize answers from a question bank and expect to pass. You need to really understand the materials. The exam also tests your critical thinking and problem-solving skills.
The main knowledge areas of the CFP exam include:
General financial planning principles
Investment and tax planning
Estate planning
Risk management
Insurance planning
Income planning and retirement savings
Financial planning psychology
Professional conduct and regulation
Apart from these topics, the CFP exam will also test your knowledge of the following concepts:
Client-planner relationships
Collecting and analyzing information
Developing, communicating, implementing, and monitoring recommendations
Evaluating the financial status of an individual/firm
Who is eligible to sit for the CFP exam?
The CFP Board wants to ensure that you are capable of sitting for the exam. To that end, you must demonstrate competency by completing the essential educational requirements.
To be eligible for the CFP exam, completion of college or university-level coursework from a CFP Board Registered Program is required, satisfying part of the education requirement for CFP certification. There are no degree prerequisites for the exam, but a bachelor’s degree must be obtained within five years of passing. For more information on exam eligibility, visit the CFP website here.
You can also be eligible for the exam if you have a professional designation in one of the following areas:
Chartered financial consultation or analyzation
Doctorate in Business Administration
Accountancy (certified only)
Law (licensed attorney only)
When is the CFP exam offered?
The CFP exam is offered in three testing windows. They are in March, July, and November. Deciding to take the CFP exam requires a lot of preparation. If you are ready to get started, you should sign up for an exam window around six months out, to give yourself enough time to study.
What is the CFP Exam Passing Score?
There isn’t a specific score needed to pass the CFP exam. At least, the CFP Board does not disclose a particular score. Instead, the board uses exam results to gauge a CFP candidate's overall competency in all required areas.
If you fail, the board will tell you the areas where you scored low and need to study more, but do not expect a detailed explanation.
You are allowed to take the exam four months later, in the next exam window, but keep in mind that if you fail the exam consecutively three times, you'll need to wait for a 1-year sit-out period (3 exam cycles) before registering for another attempt.
Finally, CFP candidates have a lifetime maximum of 5 attempts.
For this reason and more, if you've failed the CFP exam on your first attempt, it's essential that you reach out to a professional CFP tutor for help studying so you can pass on your next try.
How Can You Prepare for the CFP Exam
Cracking the CFP is challenging. But with hard work and the proper guidance, you can pass the test.
The best approach involves:
✔ Deciding the proper testing window
✔ Creating an effective study routine
✔ Studying practice questions
✔ Taking an CFP exam prep course
✔ Maintaining a positive attitude
Why are CFP exam prep classes helpful?
Most CFP candidates fail because they don't know how to study well. It's not that you aren't qualified for the exam, it's just hard to know how to study. Instead of wasting countless hours going through a mind-numbing question bank, a CFP tutor can help you identify topics where you struggle and go over core exam concepts to make sure you really understand the material.
Nissim Tutoring's online CFP prep courses provide:
✔ Study schedules to make sure you cover all topics
✔ Structure and accountability
✔ A real, live instructor who can ask questions
✔ Small group classes for personal attention
✔ A hands-on learning environment to apply concepts to real-life scenarios
✔ Mentoring and support
In Conclusion
If you are dreaming of getting your CFP certification, an online CFP exam prep course is a great way to set yourself up for success. Avoid the headache and let a professional CFP tutor guide you through the exam prep process so you can pass on the first attempt!
Sign up for a CFP class today or schedule an assessment with your CFP tutor to figure out your next steps together.
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