Certified Financial Planner Board of Standards (CFP Board)

Written by True Tamplin, BSc, CEPF®

Reviewed by Subject Matter Experts

Updated on July 12, 2023

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What Is the Certified Financial Planner Board of Standards (CFP Board)?

The Certified Financial Planner Board of Standards is a non-profit organization that oversees the Certified Financial Planner (CFP) certification in the United States.

The CFP Board sets the standards for financial planning professionals, ensuring that they possess the knowledge, skills, and ethical conduct necessary to provide comprehensive financial planning services to clients.

The CFP Board plays a critical role in the financial planning industry by establishing and maintaining professional standards, fostering ethical conduct, and promoting public awareness of the importance of financial planning.

The CFP Certification

Requirements for CFP Certification

To become a CFP professional, candidates must meet the following requirements:

Education

Candidates must complete a comprehensive course of study in financial planning, either through a CFP Board-approved education program or by holding certain recognized credentials or degrees.

Examination

Candidates must pass the CFP Certification Examination, which tests their knowledge and competence in financial planning.

Experience

Candidates must have at least 6,000 hours of professional experience in financial planning or 4,000 hours of apprenticeship experience that meets specific criteria.

Ethics

Candidates must adhere to the CFP Board's Code of Ethics and Standards of Conduct, and pass a background check.

Importance of CFP Certification for Financial Planners

The CFP certification is considered the gold standard in the financial planning industry, signifying a financial planner's commitment to providing competent, ethical, and professional services to clients.

CFP Board's Mission and Objectives

Setting Professional Standards

The CFP Board sets the professional standards for financial planners, including educational requirements, examination criteria, and experience qualifications.

Fostering Ethical Conduct

The CFP Board promotes ethical conduct among financial planners by establishing a Code of Ethics and Standards of Conduct and enforcing these standards through monitoring and disciplinary actions.

Promoting Public Awareness of Financial Planning

The CFP Board raises public awareness of the value of financial planning and the importance of working with a CFP professional.

Advocating for the Profession

The CFP Board advocates for the financial planning profession by engaging with policymakers, regulators, and industry stakeholders.

Certified-Financial-Planner-(CFP)-Board's-Mission-and-Objectives

CFP Board's Code of Ethics and Standards of Conduct

Fiduciary Duty

CFP professionals are required to act as fiduciaries, putting their clients' best interests first when providing financial planning services.

Competence

CFP professionals must maintain their competence through ongoing education and professional development.

Diligence

CFP professionals are expected to provide diligent and thorough services to their clients.

Confidentiality

CFP professionals must protect their clients' confidential information.

Integrity

CFP professionals are required to act with integrity, avoiding conflicts of interest and upholding the trust placed in them by their clients.

Professionalism

CFP professionals must act professionally, treating clients and colleagues with respect and adhering to high standards of conduct.

Benefits of Working With a CFP Professional

Comprehensive Financial Planning Expertise

CFP professionals possess the knowledge and skills necessary to provide comprehensive financial planning services, addressing a wide range of financial needs and goals.

Adherence to Ethical Standards

CFP professionals are held to high ethical standards, ensuring that clients receive unbiased, competent, and professional advice.

Ongoing Education and Professional Development

CFP professionals are required to engage in ongoing education and professional development, ensuring that they stay current with industry developments and best practices.

Confidence in the Financial Planning Process

By working with a CFP professional, clients can have confidence in the financial planning process, knowing that their financial planner has met rigorous standards of competence and ethical conduct.

Benefits-of-Working-With-a-Certified-Financial-Planner-(CFP)-Professional

The Role of the CFP Board in Regulating CFP Professionals

Monitoring and Enforcement of Ethical Standards

The CFP Board monitors the conduct of CFP professionals, ensuring that they adhere to the Code of Ethics and Standards of Conduct.

Investigation and Disciplinary Process

If a CFP professional is found to be in violation of the Code of Ethics or Standards of Conduct, the CFP Board conducts an investigation and, if necessary, initiates disciplinary action, which can range from private censure to suspension or revocation of certification.

Ensuring Continued Competence Through Ongoing Education

The CFP Board requires CFP professionals to complete continuing education requirements, ensuring that they maintain their competence and stay current with industry developments and best practices.

Choosing a CFP Professional

Evaluating Qualifications and Credentials

When selecting a CFP professional, it is important to evaluate their qualifications and credentials to ensure that they have the necessary expertise in financial planning.

Assessing Experience and Expertise

Consider the CFP professional's years of experience and the specific areas of financial planning in which they specialize, ensuring that they can address your unique needs and goals.

Compatibility and Communication Style

Choose a CFP professional with whom you feel comfortable discussing sensitive financial matters and who communicates effectively in a way that you understand.

Referrals and Recommendations

Ask for referrals from friends, family members, or other professionals who have had positive experiences working with a CFP professional.

Fee Structures and Transparency

Select a CFP professional with a clear and transparent fee structure, ensuring that you understand the costs associated with their services.

Conclusion

The Certified Financial Planner Board of Standards plays a crucial role in the financial planning industry by setting and maintaining professional standards, promoting ethical conduct, and raising public awareness of the importance of financial planning.

The CFP certification is a valuable indicator of a financial planner's commitment to providing competent, ethical, and professional services to clients.

By establishing and enforcing rigorous standards, the CFP Board ensures that clients receive high-quality financial planning services from professionals who prioritize their clients' best interests.

When selecting a CFP professional, it is essential to consider their qualifications, experience, communication style, and fee structure.

By choosing a financial planner who meets the stringent requirements set forth by the CFP Board, clients can be confident in their ability to address unique financial planning needs and goals.

Ultimately, partnering with a CFP professional ensures a higher level of expertise and ethical conduct, which can significantly impact clients' financial well-being and overall financial planning success.

Certified Financial Planner Board of Standards (CFP Board) FAQs

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website or view his author profiles on Amazon, Nasdaq and Forbes.

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