Where Should You Get a CFP?

The cer­ti­fi­ca­tion is sup­posed to tell clients you have their best in­ter­ests at heart. After that, is the name of the school im­por­tant?

Financial Planning - - CONTENT - By Michael Kitces

The cer­ti­fi­ca­tion is sup­posed to tell clients you have their best in­ter­ests at heart. After that, is the name of the school im­por­tant?

IT IS COM­MONLY BE­LIEVED THAT GET­TING A DE­GREE from the right in­sti­tu­tion may help in­di­vid­u­als get a leg up after grad­u­a­tion.

It’s per­haps no great sur­prise then that peo­ple look­ing to ob­tain a CFP cer­ti­fi­ca­tion are con­di­tioned to won­der what the best or top-ranked CFP pro­grams are, par­tic­u­larly since many of the largest CFP ed­u­ca­tion de­gree pro­grams are com­pletely un­known out­side of our in­dus­try.

Yet in the end, most con­sumers choose their fi­nan­cial ad­vi­sor based on a con­nec­tion with the in­di­vid­ual, not his/ her aca­demic pedi­gree. This means that find­ing a pro­gram where you can do well, ac­tu­ally in­ter­nal­ize the con­tent and be able to con­fi­dently ap­ply its lessons is what re­ally mat­ters.


I heard re­cently from an as­pir­ing CFP named Chad, who had a great sense of the pro­gram land­scape, but was stuck with anal­y­sis paral­y­sis about which pro­gram would be the right one to pur­sue.

His op­tions were the Amer­i­can Col­lege of Fi­nan­cial Ser­vices (where his firm had a dis­count deal), the Col­lege for Fi­nan­cial Plan­ning in Den­ver, and the CFP pro­gram at Bos­ton Univer­sity.

Chad was fa­vor­ing Bos­ton Univer­sity — even though it would be the prici­est path to earn­ing his mark — pre­cisely be­cause Bos­ton Univer­sity has name recog­ni­tion out­side the ad­vi­sory field.

But Chad was strug­gling to fig­ure out whether it was worth pay­ing a pre­mium for the Bos­ton Univer­sity name on his CFP ed­u­ca­tional cer­tifi­cate to get ac­cess to bet­ter job op­por­tu­ni­ties in the fu­ture.


Iron­i­cally, this ques­tion is not so dif­fer­ent from the anx­i­ety ex­pe­ri­enced by clients of our firms plan­ning for the fu­ture col­lege ed­u­ca­tion of their chil­dren.

Even if the kid’s just two years old, many want a fi­nan­cial plan that starts out as­sum­ing their kid will be go­ing to Har­vard, Yale or Stan­ford — be­cause they be­lieve the aca­demic pedi­gree is valu­able to their child’s fu­ture job op­por­tu­ni­ties.

But in the end, does go­ing to the right school re­ally give you a leg up on your plan­ning ca­reer?


While it may feel com­pelling to ob­tain a CFP ed­u­ca­tional cer­tifi­cate from a pres­ti­gious in­sti­tu­tion, I’ve found that most po­ten­tial clients sim­ply don’t care where you earned it.

I say this as some­one who earned his CFP mark from the Amer­i­can Col­lege, that same in­sti­tu­tion that Chad equiv­o­cated over for hav­ing vir­tu­ally no name recog­ni­tion out­side of our in­dus­try. Clients haven’t heard of it? Usu­ally true. But it doesn’t mat­ter.

In fact, it’s been 15 years since I fin­ished my CFP ed­u­ca­tion, and I think the num­ber of times I can re­call a client ask­ing where I got my CFP mark is … two.

When it hap­pened, I sim­ply re­sponded: “Well, I took my CFP classes from the Amer­i­can Col­lege. They’re not ac­tu­ally well-known out­side of our in­dus­try. But they’re the long­est-

stand­ing higher ed­u­ca­tional in­sti­tu­tion that teaches fi­nan­cial ad­vi­sors. They’ve been do­ing it for al­most 100 years.”

To which the client in­vari­ably re­sponds, “Oh, OK.” And we move on.


And the phe­nom­e­non is not unique to fi­nan­cial ad­vi­sors. Think about how this topic af­fects other pro­fes­sion­als.

Do you ask your doc­tors where they got their med­i­cal de­gree? Would it mat­ter if they said the Univer­sity of Wash­ing­ton rather than Har­vard? Would it mat­ter if I told you that, ac­cord­ing to U.S. News & World Re­port, the Univer­sity of Wash­ing­ton ranks No. 1 for pri­mary care physi­cian train­ing — and Har­vard doesn’t even fac­tor in the top 10?

The point is that most peo­ple have no idea what the top schools ac­tu­ally are, be­yond just the big name-un­der­grad­u­ate in­sti­tu­tions. This is espe­cially true when it comes to any kind of grad­u­ate level or pro­fes­sional ed­u­ca­tion.

As a re­sult, many clients just don’t ask. Or will com­fort­ably ac­cept what­ever you an­swer and ex­plain.

The Amer­i­can Col­lege orig­i­nated pro­fes­sional ed­u­ca­tion for ad­vi­sors — the Char­tered Life Un­der­writer pro­gram — al­most a cen­tury ago. The Col­lege of Fi­nan­cial Plan­ning is the long­est-stand­ing CFP ed­u­ca­tional pro­gram in ex­is­tence, hav­ing of­fered the first class of cer­ti­fied fi­nan­cial plan­ners 45 years ago. (The col­lege was ac­tu­ally part of the CFP Board for its first 13 years, split­ting in 1985 to be­come what we now know as Col­lege for Fi­nan­cial Plan­ning and CFP Board.)


Of course, if your mar­ket­ing strat­egy is to net­work through the school’s alumni as­so­ci­a­tion, then your alma mater mat­ters a lit­tle more. But it’s still not about the ed­u­ca­tional con­tent per se.

Rather, that lends it­self to a niche mar­ket­ing strat­egy. If your de­sired ad­vi­sory niche is Har­vard alums, then try to get a de­gree from Har­vard. Short of that sce­nario, clients by and large couldn’t care less from where your mark was is­sued.

The bot­tom line: If you’re proud of get­ting your CFP mark and it gives you ex­per­tise and con­fi­dence that you can put into prac­tice, you’ve gleaned the pri­mary ben­e­fit of a CFP ed­u­ca­tion.

All that be­ing said, to land a job as a para­plan­ner or an as­so­ciate plan­ner, where you earn your mark can mat­ter — a lit­tle.

When an ad­vi­sory firm hires a new ad­vi­sor straight out of a CFP pro­gram, there isn’t much to go on.

Your grades, maybe some ex­tracur­ric­u­lars … and where you went to school. In that con­text, study­ing in a known CFP pro­gram might help a bit.

If you’ve got Texas Tech or Vir­ginia Tech on your ré­sumé — schools that are known to have very rep­utable CFP pro­grams — it casts a lit­tle pos­i­tive halo. You may earn the ben­e­fit of the doubt.


That be­ing said, this will prob­a­bly get you through only the first stage of the screen­ing process and an ini­tial in­ter­view. It’s not go­ing to get you the job.

The lead­ing ad­vi­sory firms are in­creas­ingly hir­ing for pas­sion, with the as­sump­tion that they can train the skills. This means they don’t look much at your alma mater to make a fi­nal de­ci­sion.

And the same is true when we’re hir­ing for para­plan­ners and as­so­ciate plan­ners at New Plan­ner Re­cruit­ing, where I am a co-founder. We hire for pas­sion. We try to iden­tify raw ta­lent. We look barely at a can­di­date’s alma mater.

In part, this is be­cause good stu­dents come from pro­grams all over the coun­try. Our in­dus­try is not so hy­per­com­pet­i­tive that the top ta­lent goes to only a hand­ful of schools — ef­fec­tively cre­at­ing feeder chan­nels di­rectly to ad­vi­sory firms’ hu­man re­sources de­part­ments. We know this be­cause we see it in prac­tice: Good ta­lent can come from lit­er­ally any­where.

Far more valu­able and in­ter­est­ing to firms than where you learned is what you learned. Our firm ac­tu­ally ad­min­is­ters a fake CFP test that we cre­ated, and the score is based on how many ques­tions a can­di­date

If your de­sired ad­vi­sory niche is Har­vard alums, then try to get a de­gree from Har­vard. Short of that sce­nario, clients by and large couldn’t care less from where your mark was is­sued.

gets right, not which school taught him or her the an­swers.


There is one other case where your alma mater may mat­ter if you plan to go into academia and teach.

Even there, it’s still not about where you earned your cer­ti­fied fi­nan­cial plan­ner mark — that is, those six core classes, which are re­ally un­der­grad equiv­a­lent con­tent — but where you re­ceived your mas­ter’s de­gree or your doc­tor­ate.

After all, you’re not com­pet­ing for con­sumers’ minds here. You’re com­pet­ing in academia, where some schools do care about the aca­demic pedi­gree of their pro­fes­sors.

That be­ing said, even within academia, I’m still skep­ti­cal about how much this mat­ters. Be­cause so many schools are just start­ing up CFP pro­grams, they are sim­ply not (yet) ul­tra-se­lec­tive.

Th­ese schools are more in­ter­ested in hir­ing peo­ple who have good teach­ing skills, the abil­ity to rep­re­sent the pro­gram well and maybe help build out the of­fer­ing with their fundrais­ing con­nec­tions.

Some schools stricter about their in­struc­tors’ aca­demic pedi­gree than oth­ers, espe­cially when grad­u­ate-level fi­nan­cial plan­ning is in a business school.

This mat­ters, be­cause the CFP Board is try­ing to push growth now in business schools, and those pro­grams tend to hire pro­fes­sors who earned de­grees from other Aacsb-ac­cred­ited business schools. It’s fair to rec­og­nize, then, that the Ivory Tower, where you re­ceived an ad­vanced de­gree, could mat­ter.

Still, many of the new PH.D. job op­por­tu­ni­ties in re­cent years were awarded to re­cent PH.D. grad­u­ates, to help build out pro­grams. School pedi­gree may have been a fac­tor, but prob­a­bly not a driver of the hir­ing de­ci­sion.


For most peo­ple look­ing at a cer­ti­fied fi­nan­cial plan­ner ed­u­ca­tion, here are my four tips for se­lect­ing a pro­gram that fits:

1. Ed­u­ca­tional cur­ricu­lum: What classes and elec­tives do the schools of­fer? Are the elec­tives rel­e­vant and ap­peal­ing to you? Which school makes you feel most ex­cited about the learn­ing you’ll do?

2. What’s the learn­ing plat­form? Is it a vir­tual pro­gram where you’re go­ing to be at a dis­tance, or is it in per­son? Do you thrive with in-per­son in­struc­tion, or would you rather study on­line? Which aligns best with your learn­ing style?

3. Which one fits your sched­ule? The truth is some­times it just comes down to sched­ul­ing and con­ve­nience. “Hey, I found a cool pro­gram, but they teach on Tuesdays, and I can’t do Tuesdays be­cause I got stuff with my kids. I can do Thurs­days, so I’m go­ing to do this other pro­gram.” Or, “I’m go­ing to do a vir­tual one that’s asyn­chro­nous so I can study on the week­ends, and it doesn’t mat­ter when the classes are.”

4. Which one fits your bud­get? Costs do vary from one pro­gram to another, and fi­nan­cial need should fac­tor in your pick­ing the best CFP reg­is­tered pro­gram. Again though, the big­gest de­ter­mi­nant of suc­cess is how well you learn the ma­te­rial and how con­fi­dently you can ap­ply its lessons.

If you’re proud of get­ting your CFP mark and it gives you ex­per­tise and con­fi­dence that you can put into prac­tice, you’ve gleaned the pri­mary ben­e­fit of a CFP ed­u­ca­tion.


We’re be­gin­ning to see re­search that bears this out, vis-a-vis the value of a CFP ed­u­ca­tion. No one cites the aca­demic pedi­gree of their pro­gram. Rather, study par­tic­i­pants talk up the con­tent of their ed­u­ca­tions. “It gave me ex­per­tise to help my clients more,” they say, or “It gave me con­fi­dence to talk to my clients more ef­fec­tively.”

The right pro­gram equips you to de­liver good business re­sults. That’s ul­ti­mately what mat­ters.

What do you think? Has any­one ever asked where you got your CFP ed­u­ca­tion? Do you think it mat­ters where you get your CFP ed­u­ca­tion? Are there any spe­cial cir­cum­stances when where you re­ceived your ed­u­ca­tion might re­ally mat­ter?

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