Written by: Corey Janoff
This post was originally published on our previous blog website on February 21, 2017 and has since not been revised and/or updated.
This week’s post is part of a series of posts we will have in which Lukas Ng chronicles his journey towards passing the CERTIFIED PLANNER PLANNER™ course curriculum and final exam. Having been through the process and passing the exam in the fall of 2011, I can attest that it is no small task. The test has evolved over the last few years, so it will be interesting to hear from someone going through the process currently. Take it away, Lukas!
There is a lot of talk about various designations in the financial advising world. There’s the CFP®, ChFC®, CLU®, CFA®, AIF®, etc. A financial professional could spend his/her entire life obtaining the entire alphabet behind their name, and you can take a look at https://www.finra.org/investors/professional-designations to see a list of the various different designations out there. There is one that many financial advisors have been telling me to obtain since I started in the industry and that Is the CFP® – CERTIFIED FINANCIAL PLANNER™. This series is going to be dedicated to walking through my journey to obtain this credential and my thoughts along the way.
To get the credential one must complete seven college level courses: Financial Planning – Process & Environment, Fundamentals of Insurance Planning, Income Taxation, Planning for Retirement Needs, Investments, Fundamentals of Estate Planning, and Personal Financial Planning: Comprehensive Case Analysis. At the end of each course there is an exam that covers the materials of the course.
Once you complete all seven courses and pass all the exams, there is an additional comprehensive final exam that covers all the topics collectively in the aforementioned courses.
Here we go…
Though contrary to what I thought when I learned how rigorous this certification would be, the first course wasn’t that bad at all. This makes sense though, they probably don’t want to kill us right off the bat. It went over general financial planning principles and the process of financial planning. Given the comprehensive training nature of our firm, these were very basic concepts and merely an extension of common sense in my opinion.
There was a section on time value of money, but with my background as a math major I skipped reading those chapters entirely because I figured had a good understanding of those concepts. This was one of my big learning points and mistakes. When I took my first practice exam I reasoned out all the logic and created these convoluted formulas to solve the questions which resulted in a full hour to answer a few basic questions. They were correct answers, but I was curious if I was supposed to memorize these equations I came up with. When I went back to the book afterwards to see their method, I slammed my face into the wall multiple times to punish my stupidity because it turns out that with a financial calculator you can solve all the problems with a few simple keystrokes. Lesson learned; read all the words on the page.
The most difficult part about this first exam is the sheer amount of memorization of laws, regulations, and ethics rules. Don’t get me wrong, all these are very important to a financial professional, but it is extremely tiresome and tedious. I spent the most of my preparation time on this facet of the exam since I could easily see myself forgetting a few rules or mixing things up resulting in a failing grade.
I started studying with about an hour on Saturday, and four to six hours on Sunday. I would spend about 30-60 minutes throughout the week in total refreshing my memory on obscure facts/rules/regulations since those were the toughest for me as I wanted to keep those fresh. I registered for my exam to be on the fifth week after I bought my course materials. The day before the exam I spent an extra two hours of studying to review, and that method seemed to work out as I passed without sweating too much.
When I counted my total study hours, I spent between 30 and 40 hours preparing for this exam. Nothing crazy by any means, but I’ve been told that as I proceed through to the next courses the difficulty ramps up a significant amount. We’ll see how that goes and I’ll keep you all up-to-date on my progress towards becoming a CFP® professional. Balancing working a ridiculous amount of hours as a financial planner while simultaneously studying for this exam, I found it a minor struggle to find time to hang out with friends and family, but it was still doable. I have a feeling as we get to the later courses and the final study crunch I may disappear from the face of the earth to my friends & family.
In the meantime, time to celebrate this first victory in a long line of many.
Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design) and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements.
For more information about the CFP® certification, visit letsmakeaplan.org.
