Difference Between CFA® and CFP

Certified Financial Planner (CFP) and Chartered Financial Analyst (CFA) are some of the most prestigious designations for any aspiring financial advisor. While CFP helps develop wealth management and financial planning skills, CFA focuses on developing asset allocation, investment analysis, portfolio strategy, and corporate finance skills.

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CFA vs CFP Infographics

CFA vs CFP – Comparative Table

CFA vs CFP – Which is Better?

One of the most important questions that come to our mind is – which is a better option out of CFA and CFP? The answer is that both are highly admired designations in financial advisory. Any candidate with a CFA charter or CFP mark becomes skillful at handling the client’s financial future. Hence, the choice between CFA and CFP should be purely based on career aspiration as either of the courses can offer an exciting career in finance. So, let us dive in deeper to understand the two designations in more detail in the following sections.

  • Financial Principles Financial Analysis & Accounting Portfolio Management

  • Estate Planner Retirement Planner Risk ManagerRisk ManagerA risk manager takes care of the financial risk management of an organization by proactively identifying and analyzing potential risks along with the development of preventive measures to either entirely remove or minimize these risks.read more Financial Manager

  • Level I – 41% Level II – 44% Level III – 56%

  • 62% (Overall) 66% (First-time test takers)

  • Level I – Feb 15-21, May 17-23, Aug 23-29, Nov Level II – Feb 22-26, Aug 30- Sep 03, Nov Level III – May 24-26, Aug 30- Sep 06

  • Mar 8 – 15 Jul 12 – 19 Nov 1 – 8

Skills Obtained

After becoming a CFA charter holder, a candidate develops excellent modeling skills, analytical ability, decision-making skills, and communication skills. Similarly, a CFP mark holder also acquires strategic thinking, sales & marketing, relationship management, and communication skills.

Duration

An aspiring CFA candidate needs to clear three levels of examinations and four years of professional experience, which can be completed before, during, or after completion of CFA. Hence, one can complete the CFA program in 4 years. On the other hand, a candidate who enrolled for CFP needs to clear just 1 level but must complete 6,000 hours of professional experience and complete the CFP program over three years.

Eligibility or Experience Required

To become a CFA charter holder, one must complete a bachelor’s degree and have at least four years of relevant professional experience. On the other hand, a CFP aspirant must have a bachelor’s degree and 6,000 hours of relevant professional experience or 4,000 hours of apprentice experience. However, there is a flexibility to combine education and professional experience, sequential and not overlapping, to meet the 4-year requirement.

Syllabus

The CFA program is divided into three levels. Level I focuses on financial principles, Level II emphasizes financial analysis and accounting, and Level III helps build portfolio management and decision-making skills. There is a little bit of overlapping of topics among the three levels. The overall syllabus CFA program includes financial reportingFinancial ReportingFinancial reporting is a systematic process of recording and representing a company’s financial data. The reports reflect a firm’s financial health and performance in a given period. Management, investors, shareholders, financiers, government, and regulatory agencies rely on financial reports for decision-making.read more and analysis, ethical & professional standards,  economics, derivatives, equity valuation, quantitative methods, fixed income, alternative investments, corporate finance, portfolio management, etc. On the other hand, the CFP Board mandates the course curriculum to include professional conduct & regulation, general principles of financial planning, investment planning, education planning, retirement savings & income planning, risk management & insurance planning, tax planning, estate planning, financial planning, etc.

Career Opportunity and Salary

A CFA charter holder is offered a job in finance and investment as a portfolio manager, research analyst, consultant, corporate financial analyst, investment banking analyst, relationship manager, financial advisor, etc. On the other hand, as a CFP designation holder, a candidate is offered the role of a financial planner, financial advisor, estate planner, trading & research associate, financial consultant, financial analyst, financial representative, etc.

In the U.S., CFA charterholders vary in the range of $56,500 and $120,500 per annum, with an average salary of $95,494. On the other hand, the salary of CFPs varies in the range of $62,500 and $94,500 per annum, with an average salary of $83,123.

Fees and Passing Rates

The CFA exam fees lie in the range of $700 to $1,000 per exam, depending on the time of registration. Additionally, there is a $450 one-time registration fee, which means that a CFA program’s total fees will be $2,550 and $3,450. On the other hand, a CFP program costs $825 and $1,025, depending on registration.

Both the exams are equally difficult, as seen from their moderate pass rate. During 2019, the Pass Rates For The CFAThe CFA exam is regarded as one of the most difficult to crack. Your preparation, time management, and sequence plays will all play an important role in your journey.read more exams were – Level I: 41%, Level II: 44%, and Level III: 56%. For CFP, the overall pass rate in 2019 stood at 62%, while the first-time exam takers were 66%.

Exam Availability

The exams for the three levels of CFA take place several times during the year. In 2022, the exam schedule is as follows:

The exams for CFP take place three times a year – March, July, and November. In 2022, it is scheduled to occur during Mar 8-15, Jul 12-19, and Nov 1-8.

CFA vs CFP – How to Enroll?

For CFA,

  • Create an account at the CFA Institute website before the exam registration. However, if one plans to apply for any scholarship, they should register much earlier.Make the fee payment for the relevant exam.Schedule testing appointment.

For CFP,

  • Create an account at the CFP Board website and complete the exam registration form.Make the payment for the registration fee.Schedule testing appointment.

Conclusions

CFA vs. CFP, whatever your end choice may be, let it be an informed one. This decision is for your career and hence keep in mind all these pros and cons. I could help in whatever little I could. All the very best :-)

It is a guide to CFA vs. CFP. Here we discuss the top difference between CFA and CFP careers, examination pattern, pass rates, fees, and job opportunities. If you wish to evaluate other financial certifications, you can also checkout –

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