Financial Consultant Certification and Degree Program Information

No certification or degree is required for financial consulting, but they can be helpful for seasoned professionals and individuals wanting to establish themselves in the profession. Certification options and requirements vary, and a master's degree is available for advanced studies.

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Essential Information

Becoming a Certified Financial Planner (CFP), Chartered Financial Consultant (ChFC) or Certified Financial Analyst (CFA) or obtaining a Master of Science in Financial Planning can distinguish a financial consultant from competitors by demonstrating commitment, expertise and competence. Certification programs are offered by many colleges and universities.

CFP certification requires a bachelor's degree, experience and a proven understanding of 100 topics related to financial planning. ChFC certification is aimed at experienced professionals in related fields, such as insurance or real estate. Students are required to pass an exam courses such as income tax and estate planning. CFA certification is a rigorous course of study aimed at experienced professionals in investment related fields. Topics studied include investment tools, asset valuation and portfolio management.

A master's degree program in financial planning commonly contains course topics including income taxes, employee benefits, wealth preservation and financial services. Some programs look at corporate finance as well. If the CFP Board approves, credits earned can apply toward certification requirements.


Certified Financial Planner Certification

Candidates gain a comprehensive understanding of personal financial planning and demonstrate the ability to apply this knowledge in their practice. They meet rigorous professional standards, adhere to a formal code of ethics and remain current in the field through ongoing education. The Certified Financial Planner Board of Standards, Inc. awards the certification.

The CFP Board requires the equivalent of three years of full-time financial planning experience for the certification (2,000 hours of part-time work counts as one year). The experience must have been earned during the period from ten years before and five years after taking the exam. At least six months must occur within a year of the exam. For the experience to qualify, applicants must have taught, supported, supervised or performed at least one of the following: client relationship management, financial goal setting, financial status assessment, financial recommendation development or financial plan implementation and tracking. Experience may be acquired through an internship with a CFP Board Registered Program or a residency with the Financial Planning Association.

Preparation for the CFP exam requires an understanding of 100 topics and the ability to apply the knowledge gained in the program to financial planning activities. Programs are available for studying on campus or through distance learning. Topics covered fall under the following categories:

  • Financial planning principles
  • Employee benefits, retirement and insurance
  • Risk management
  • Income tax and investments
  • Estate planning

Applicants are eligible to take the exam without the courses if they are a doctor in economics, business or business administration, an attorney, a certified public accountant, a chartered financial analyst, a chartered financial consultant or a chartered life underwriter. In addition, the study requirements may be reduced for applicants who are actuaries, Certified Employee Benefits Specialists or enrolled insurance agents.

Chartered Financial Consultant Certification

The ChFC designation is tailored for professionals in related fields, such as insurance sales, who intend to expand their services to include financial planning. It is awarded by the American College of Bryn Mawr.

The ChFC program requires completion of nine courses, of which two are elective. An exam must be passed for each course. Some of the required courses include:

  • Income tax
  • Investments
  • Insurance
  • Retirement planning
  • Estate planning
  • Financial planning in practice

Certified Financial Analyst

The CFA program prepares participants for a wide variety of careers in investment-related fields. The program emphasizes the financial concerns of institutions so it is suitable for those seeking positions with companies, organizations or governmental agencies. The CFA Institute, an international association of investment professionals, awards the charter.

Participants must sign statements agreeing to adhere to professional standards and a code of ethics. They must also hold an international travel passport.

The program is rigorous. The CFA Institute describes it as comparable to graduate school (www.cfainstitute.org). It has three levels, each with 18 study sessions. A qualifying exam must be passed for each level. Candidates should plan to spend at least 300 hours studying for each exam. While the program can be completed in as little as 18 months, the average is four years. Subjects studied fall under four broad areas:

  • Professional standards and ethics
  • Investment tools
  • Asset valuation
  • Portfolio management and wealth planning

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Master of Science in Financial Planning (MSFP)

A MSFP prepares students to engage in financial advising and analysis with a strong basis in business principles, with some programs also covering corporate finance material. Hence, the program is suitable for students with no experience in financial planning or professionals seeking to gain greater expertise and augment their credentials with a graduate degree.

The MSFP program generally requires two years of full-time study to complete. Most programs allow students to attend part-time. If the CFP Board has certified the program, coursework can count toward the CFP study requirement. Typical coursework includes:

  • Financial and data analysis
  • Financial planning
  • Investments and investment management
  • Employee benefits and retirement
  • Income tax and financial services
  • Estate planning and wealth preservation

Popular Careers

Some financial analysts worked in insurance and finance. Their employers included banks, credit institutions, insurance companies, brokerages and governments (www.bls.gov).

CFAs and graduates of MSFP programs hold a wide variety of positions, including:

  • Research analyst or tax advisor
  • Corporate financial or investment banking analyst
  • Financial consultant or advisor
  • Client relationship, portfolio, money or risk manager
  • Financial planner or estate planner
  • Investment advisor or retirement planner

Employment Outlook and Salary Information

According to the U.S. Bureau of Labor Statistics (BLS), the demand for personal financial advisors is expected to grow by 30% from 2014 through 2024, mainly due to the number of baby boomers who will reach retirement and seek financial consulting (www.bls.gov). The BLS also reports that the median annual salary for personal financial advisors in May 2015 was $89,160.

While the BLS projects much faster than average growth in employment from 2014 through 2024 for personal financial planners, it also notes that the field will be competitive because it is relatively easy to enter and earnings can be high (www.bls.gov). The ChFC designation may help to distinguish a professional entering the field.

Continuing Education

The CFP certification must be renewed every two years by submitting an application, paying a fee ($325 in 2015) and completing 30 hours of continuing education. Two hours must be from a program on ethics or financial planning standards. The remainder must be from programs covering approved topics. Continuing education may also be earned through teaching, authoring and obtaining additional professional licenses or designations.

ChFC holders must complete 30 hours of continuing education every two years if they:

  • Provide financial planning, insurance, employment benefits or estate planning advice
  • Hold an insurance license
  • Hold a securities registration or licenses

CFAs do not require continuing education. However, CFAs must pay annual membership dues and remain in good standing by complying with bylaws, a code of ethics and professional conduct standards. The CFA Institute encourages ongoing education by offering seminars, awarding credits for attendance and publishing study credit milestones.

Prospective financial consultants may find that certification gives them a competitive edge within the field. CFAs and graduates of MSFP programs often undertake popular careers such as a tax advisor or financial planner.

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