What Is a Certified Financial Planner™ (CFP®)?
CFP® is a formal designation awarded by the Certified Financial Planner Board of Standards, Inc. to individuals who complete a rigorous certification process. To obtain the CFP® credential, professionals must fulfill four requirements.
A CFP® professional must hold a bachelor’s degree or higher and complete CFP Board approved coursework in the major areas of financial planning: general financial planning, investment planning, retirement savings, education planning, insurance planning, tax planning, and estate planning.
Once an individual finishes the coursework, he or she must pass a 170-question multiple-choice exam that takes place over two 3-hour sessions.
Upon completion of the education and exam requirement, an individual must obtain 4,000 – 6,000 hours of work experience related to particular components of personal financial planning.
Lastly, CFP® professionals must commit to an ethics requirement pledging to adhere to high ethical and professional standards in the practice of financial planning. This coincides with the fact that all CFP® professionals must put their clients’ interests first at all times.
To sum it all up, a CFP® has dedicated time to educating themselves, gaining valuable experience, and holding high standards of ethical behavior. Most importantly they are required to put your interests first.
Why Choose a Certified Financial Planner™?
CFP® professionals implement a holistic, personalized approach in helping clients reach their financial goals. In an industry that often narrowly focuses on investments, a holistic approach examines all aspects of your personal and financial life to understand what’s important to you and your family.
CFP® professionals also hold themselves to the fiduciary standard, which states they must act in your best interest at all times. This means CFP®s cannot put their interests or the interests of their firm above yours. Your interests always come first.
Other advisors who do not have the CFP® designation or are not a Registered Investment Advisor (RIA) hold themselves to the suitability standard. This less stringent standard requires advisors to do what they believe is suitable for their clients. This small distinction means advisors can have compensation structures in place that create conflicts of interest between you and their firm.
With so much room for interpretation, the suitability standard often allows advisors to wear two different hats: sometimes acting in your best interest, while other times acting in the best interest of themselves or their firm.
This may be one of the most important questions you can ask your potential financial advisor: Are you a fiduciary?
Durbin Bennett Certified Financial Planners™?
At Durbin Bennett, each of our advisors holds the CFP® designation, at the minimum. Collectively, our firm has 8 CFP® professionals and over 130 years of financial services experience. We utilize a holistic financial planning approach to understand your financial goals and educate you on the different aspects of your financial life. As fiduciaries, we are always required to put your interests first.
Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, 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.