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CFP Eases Experience and Capstone Requirements for Certification

The Certified Financial Planner Board of Standards announced two changes to its certification process on Tuesday that will make it easier for more people to take the CFP exam.  

The first allows CFP candidates with certain professional credentials – like certified public accountants, a Ph.D. in business or economics, or a licensed attorney – to avoid taking the “capstone” course on financial plan development by instead submitting a completed, comprehensive financial plan to be assessed by CFP professional reviewers.

The CFP board will also now consider activities and job responsibilities indirectly related to financial planning as credit towards the three-year experience requirement. A press release announcing the changes said positions in employee benefits administration, financial planning compliance and even financial planning journalism could be considered, though Michele Warholic, the CFP’s managing director of examinations, education and talent, said this experience wouldn’t guarantee credit.

“We will analyze them on a case-by-case basis, and we expect that the majority of people will not qualify for full credit,” Warholic said. “Different types of duties and responsibilities are using financial planning knowledge and topics as opposed to a very narrow definition.”

Reactions among financial advisors were varied, and many took to social media to express their opinion. Some welcome changes to the system.

Daniel Lash, a partner VLP Financial Advisors, said he doesn’t see the changes as a problem as long as it doesn’t drastically inflate the rate of advisors receiving a CFP designation.

“If it goes above 60 percent, then its time to worry,” Lash told

Warholic said she “whole-heartedly” disagreed with the notion that the CFP would get any easier, and said it would actually be harder and more time consuming to submit a complete financial plan than take a class. But some CFP members are worried about the effect the changes would have on the prestige of the title.

“Attaining the CFP designation has historically been a culmination of extensive classwork, practice, and time commitment,” said Elliott Weir, a CFP member and founder of III Financial, who added that he worries that the “gold-standard” of the CFP is losing its luster. “Does the public benefit from allowing a licensed attorney … without any classroom work to use the covet [sic] marks by demonstrating a passing ability to generate software output and by taking a computerized exam?”

The complaints echo those made by advisors earlier this year, when CFP said it would reduce the length of exam from 10 hours to six, and in 2011, when CFP cut the mandatory experience requirement.

Unlike in 2011, CFP did not submit the proposed changes to members and ask for public comment this time around. The CFP board of directors already approved the initiatives and they take effect on or before July 1, 2015.

Warholic said the CFP board did not seek member comments because the changes were not "substantive."

Stephen Barnes, a CFP certificant with Barnes Investment Advisory in Phoenix, welcomed the changes but disagreed that the changes weren’t substantive enough to alert members.   

“The CFP Board regularly sends me emails about so many minor issues,” Barnes said. “I find it curious that, in looking through my recently received emails, I have nothing from them about these two changes."

While the number of CFP-registered programs is on the rise, many students aren't sitting for the exam. A 2013 study conducted by the CFP board and San Diego State University found that only 30 percent of students with a bachelor's or master's degree in financial planning had taken the CFP exam. The study found that some of the primary reasons for the low number were the cost of the course and the experience requirements. 

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