^ LOL!
Agreed, it never hurts to have a basic undertanding of something, however if you are not a barred attorney and you start advising people on estate planning issues, you run the risk of engaging in the unauthorized practice of law! If you are not a CPA and you start advising clients in tax issues, then you run to risk of practicing as a CPA with no authorization, etc. The down fall of the CFP is that you get a very little bit of knowledge in the various areas of financial planning that it makes you very dangerous if you are not already an expert in that area and opens you up to a lot of liabilities.
So, Palacios. I am a CPA and (hopefully soon) a CFA Charterholder. I work in a tax practice. Of course, the vast majority of the work is business tax returns, but there’s a fair amount of trust, estate, gift (and the associated valuations), and income tax planning. I assume that I’ll get exposure to all of it over time.
That being said–is there any reason (besides brand recognition) to pursue CFP? Do you think I’d learn anything at all? Or do you think it would be akin to a lawyer getting his paralegal certificate?
Now, as far as brand recognition–that might be a harder battle. If I ever get license to start financial planning and investments for clients, I would have to contend with a lot of the CFP’s around town. Texas Tech is only two hours north of here, and they have a CFP/Bachelor’s combination, and I think it gets a lot of good publicity around town. (My personal opinion–I guess if you can’t do something useful, like CPA or CFA, then just do CFP.)
Man, with your CPA licence and CFA Chater, I would think you’d be much more sought after than someone who just has a CFP. But that is just my opinion. Think about it this way; you’re a trained professional in both tax and investments whereas a CFP is someone who knows a little bit about insurance, tax, investments, estate planning and retirement planning. They are definitely not an expert in any of those areas just because they have a CFP. In fact the CFP materials refer to the CFP professional as someone who should consult with the professionals in these different areas before advising clients. As a CPA you are probably aware of the tax laws surrounding retirement plans and estate plans already and as a CFA you are trained in investments, so I think you’d just be spinning your wheels getting the CFP. I think you’d find yourself very disappointed with the program. I know I was. That is just my 2 cents.
I did the CFP a few years back along with the CPA exam. I feel like the CFP is being given away to anyone who pays the fee nowadays. I do think it has some retail value though.
By far, the three biggest credential to have in the accounting & finance world are CPA, CFP & CFA. The CFA is far & away the most challenging IMO. The CFP is far & away the least challenging IMO. That being said, a regular finance person likely couldn’t grab some books & study & pass the CPA exams (IMO) because it took a Master’s in accounting to get to the point of taking it.
Once you have any of those credentials then taking something like the AWMA becomes a waste of time - you wouldn’t even want to put it on your business card.
So, Chris. Have you taken all three exams? CFP, CFA, and CPA? (Your profile says you’re a Level 3 candidate. Just assume that Level 3 is as hard as Level 2.)
If so, you’re the first person that I know that has taken all three. How do they all compare?
Hahaha, tax planning is incredibly important and often times offers a greater return then pure investment advice. that being said most tax guys wouldn’t know asset allocation or security selection from a hole in the ground, in fact when it comes to business sense outside of their narrow scope of specialisation they rarely know anything of value.
Yeah, but being an FA for the bottom 95% is a mugs game, to get compensated fairly you need to go after larger clients with more complex issues. At that point most FA’s are just quarterbacks that get specialists to do all the real complex work for their clients while they focus on gathering and managing assets/picking subadvisors.
Hi Greenman - yes, I am a level 3 candidate. I just started studying last week. I’m planning on putting the same effort on level 3 as level 2 although I don’t feel like I have the leg up that I did on the first two levels because no financial section, but I’ll know more about how deep I am in a hole once I get into the curriculum more.
I went to a continuing ed conference a few years ago & one of the speakers was a CPA, CFP, CFA & I remember being impressed with his knowledge so I decided to do the same - plus I thought it would be cool :). I also switched from public accounting over to wealth management in 2010 so I feel like the CFA is going to help tremendously. Half my clients have no clue what any of the letters mean, but my engineering/finance/business/medical clients respect that alphabet soup more - I feel it particularly lends some credit to me because I am young & look young. I only know one other person in my region who has been dumb enough to get earn all three credentials.
I passed the CPA & CFP the first go around & I feel like the CFA is far & above the most difficult of all three exams. Anyone, like you, who has the Charter I have a big respect for as it is a huge sacrifice personally to get through the program. You have to put in the time, but you also have to be smart which can be two different things (like the CFP-only time is required IMO). I passed the CPA in 2007 while finishing my Masters, CFP in 2009 & will hopefully be done with the CFA in 2014 (fingers crossed).
The CPA took about 150-200 hours per section to study for (~6-800 total). The CFP took me about 250 hours to study for but I already had the CPA background which helped somewhat. Level 1 of the CFA took about 200 hours of study, Level 2 took about 350 hours of study & I plan to spend the same amount on Level 3. I hope sticking to a similar strategy works this time around! I appreciate any feedback you can give me!
Thanks for the .02 on the exam difficulty.
As noted above, I’ve considered doing CFP (a long time from now), not because I think I’ll learn anything from it, but simply because it has notoriety. If/when I ever start doing investments for clients, I don’t want to be losing business to the local Texas Tech “financial planning” major, simply because he took the classes “Life, Love and Money” and “Gender and Cultural Issues in a Financial Context”.
To answer your question about whether L3 is harder than L2, see this thread:
http://www.analystforum.com/forums/cfa-forums/cfa-level-iii-forum/91325809
If you’re ok with tracking more CPE (some classes count for both CPA/CFP) & paying the $350 or whatever the dues are each year then I would say go for it. In the average retail advisory world the CFP (IMO) carries some weight with clients. Having done the CPA/CFA you’ll be a shoe in to pass. Also, having the CPA license puts you ahead of the game as you can skip the classes & just go straight to the exam - after you study, of course.
Thanks for the info - I get the feeling I’m going to be slightly uncomfortable with some of the topics & AM section this go round…
^So, if you were to take CPA & CFA first, how much time do you think you’d need to study for CFP? (I think that the order that you take the exams determines how much study time you need.)
Greenman - sorry - just saw I didn’t respond to your question. If you do the CFP last I don’t think you would need any more than 125-150 hours to pass. Most everything on the exam you would have seen before in one way or another. Insurance, learning their way of thinking & refreshing the other topics shouldn’t take any longer than that.
^Thanks for the response.
I thought about CFP for a while, for no reason other than marketing. But I’ve put it aside indefinitely. Not only do you have to take the test (which means studying another 150 hours or so), but you also have to pay for the test, pay for the CPE, take the CPE, pay for the initials, etc. Plus, before you can even take the test, you have to take a capstone course which costs a pretty good chunk, and you have to prepare for it.
I’m not hatin’ on the CFP, like many others on this forum will, but I just have a hard time justifying another couple of thousand dollars and another 300 hours or so, just to add some more alphabet soup. I’m starting to see diminishing marginal returns on my alphabet soup already.
I’m shocked you don’t have the CFP. You are by far the one that mentions it the most around here.
^I mention it mainly to be a polemic. But in reality, I think that it probably would have more bearing on my job than the CFA. And even though it’s a “lesser credential” and the test isn’t nearly as hard, I think that it gets a particularly bad rap here, because people think that understanding embedded derivatives in mortgage pass-thru pools is somehow on a higher moral plane than understanding IRA’s and Social Security.
Bad rep from who? BOM?
Surely you jest. Have you not seen the posts on here that say, “I’d rather hack my sack than be a CFP”?
I must have missed those. Are those the same people that rather hack their sack than get a degree from Columbia or Booth?
Haha - I hear what you’re saying. To b honest, had I done the CFA first I probably wouldn’t have done the CFP due to the less respect in the community factor & it doesn’t hold a candle to the CFA difficulty. That being said, I’ve ran across other financial planners who have the CFP & they think they are above all others which is kinda funny. Anyone who is higher level in the finance world knows the CFA is tough - especially those in institutional money. They don’t pay my family’s bills though so I could care less. CFP fees are a bit of a bummer, but I didn’t have to take a capstone course back when I tested which is nice.