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Competency Standards Review Will Ensure CFP® Certification Remains the Standard for Financial Planning Profession

By Kevin R. Keller, CAE December 21, 2022 LinkedIn

CFP® certification is no longer a “nice-to-have” mark for financial planners, as it was 50 years ago. It is now a high-stakes certification that financial services firms across the country require for client-facing roles. At these firms, CFP® certification permeates the organization’s culture and signals to employees and their clients the firm’s commitment to competent and ethical financial planning.

As we enter the 50th year of CFP® certification, it's timely that we conduct our first-ever comprehensive review of the competency standards. To that end, CFP Board recently announced the formation of a Competency Standards Commission that will evaluate the requirements for CFP® professionals.

The commission’s review will address the competency of candidates for CFP® certification and the continued competency of CFP® professionals. This vital process will ensure that CFP® certification continues to be recognized by the financial advice ecosystem as the standard for financial planning.

As the professional organization that sets and enforces the standards for CFP® certification, CFP Board has the obligation to ensure that the certification remains valid, reliable and legally defensible for the benefit of the public. Doing so necessitates regular reviews of our professional and ethical standards, our enforcement processes, and the knowledge, skills and abilities that are assessed by the CFP® exam and integrated into CFP Board Registered Program curriculum.

We’ve completed each of these reviews within the last five years, but we have not yet evaluated another critical component of CFP® certification: our competency standards. These are the Education, Examination and Experience requirements that candidates for CFP® certification must fulfill in order to join the ever-growing ranks of CFP® professionals. CFP Board has required that candidates for CFP® certification hold a bachelor’s degree or higher from an accredited college or university, complete financial planning coursework through a CFP Board Registered Program, pass the CFP® exam and complete a set number of hours of either professional or apprenticeship experience. The competency standards also include Continuing Education (CE) requirements for CFP® professionals seeking to renew their certification, which they must do every two years.

As it conducts this review of our competency standards, the commission will evaluate topics such as current education requirements and the efficacy of the experience requirement. It will collect input from CFP® professionals representing various business and compensation models as well as stakeholders within the financial advice ecosystem It will examine research relating to client expectations, opinions and experience with CFP® professionals. And it will consider the competency standards of several other established professions.

Based on this thorough and inclusive evaluation, the commission may recommend changes for improving the competency standards, or it may validate CFP Board’s current requirements. In either case, the commission’s recommendations will be subject to review and approval by the Board of Directors.

The commission’s work will ensure that CFP Board is responsive to both current trends in the financial planning profession and best practices of certifying bodies. It may also bolster our profession-wide efforts to diversify and strengthen the financial planning talent pipeline. Addressing barriers to entry for underrepresented groups is a key part of those efforts.

CFP Board will announce the members of the Competency Standards Commission early next year. Commissioners will be a select group of volunteers consisting of individuals from financial services firms, educators, certification and credentialing professionals, and other stakeholders, including members of the public. We look forward to working with them and to receiving their recommendations.

The financial planning profession and the public’s demand for personal financial advice are constantly evolving. It is incumbent on CFP Board to remain current. Our competency standards should fulfill the expectations of the financial planning profession and the clients and communities it serves. The Competency Standards Commission will ensure that they do.

This article was originally published on LinkedIn on December 21, 2022.


About the Author: Kevin Keller, CAE is Chief Executive Officer of CFP Board. CFP Board’s mission is to benefit the public by granting the CFP® certification and upholding it as the recognized standard of excellence for competent and ethical personal financial planning.