CFP vs MBA – Differences

CFP exam is Certified Financial Planner Board of Standards, USA, and prepares you for estate planning, retirement planning, risk management, and financial management roles. Whereas, MBA is usually a 1- 2 year full-time course offered by various institutes and focuses on preparing students for many careers depending on specialization like Finance, Marketing, IT, Operations, HR, etc.

We will discuss the following in this article –

  • CFP vs. MBA InfographicsWhat is a Certified Financial Planner (CFP)?What is a Master in Business Administration (MBA)?CFP vs. MBA Exam RequirementsWhy pursue CFP?Why pursue an MBA?

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CFP vs. MBA Infographics

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Let’s understand the difference between these two streams with the help of this CFP vs. MBA Infographics.

CFP vs. MBA – Comparative Table

What is a Certified Financial Planner (CFP)?

CFP helps you gain a seal of professional certification as a financial planner. CFP gives you international recognition as a financial planner, affiliated organizations outside the USA, and the international owners of CFP. This course is conducted by the Certified Planner Board of Standards or the CFP board. This board is based in the USA. Twenty-five other organizations are authorized to conduct this certification course examination because of their affiliation with the CFP.

  • General Principles of Financial Planning

  • Risk Management & Insurance Planning

  • Professional Conduct & Regulation

  • Tax PlanningTax PlanningTax planning is the process of minimizing the tax liability by making the best use of all available deductions, allowances, rebates, thresholds, and so on as permitted by income tax laws and rules imposed by a country’s government. It contributes to better cash flow and liquidity management for taxpayers, as well as better retirement plans and investment opportunities.read more

  • Retirement Savings & Income Planning

  • Education Planning

  • Estate Planning

  • Investment Planning

  • Managerial Economics

  • Accounting

  • Business Statistics

  • Operations Research

  • Financial Management

  • Marketing Management

  • Human Resource Management

  • Business EthicsBusiness EthicsBusiness ethics is the study, application, and implementation of various principles, policies, and standards in areas such as corporate governance, whistleblowing, corporate culture, and corporate social responsibility.read more

  • 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

  • Financial Analyst

  • Operations Manager

  • Financial Advisor

  • Human Resource Manager

  • Marketing Manager

  • Mar 08-15 (Registration started from Nov 11, 2021)

  • Jul 12-19 (Registration to start from Mar 17, 2022)

  • Nov 01-08 (Registration to start from Jul 14, 2022)

The examination continuously for two days for 4 hours per day gives you the designation of CFP, for which you need to pay a fee for registration, examination, and study material. And along with paying the fee, the candidate needs to meet the course’s education criteria by appearing for examinations, experiencing financial planning, and following its ethical standards by following its code of ethics. The specifications of this course or this certificate are different for both the USA and the UK candidates.

What is a Master in Business Administration (MBA)?

This master’s degree is not just a certification; it’s a fully-fledged degree with options for multiple specializations. The institution you clear your MBA from will add national and international recognition to your career. This degree helps develop your talent and know-how important in building your career in business and management. This course helps you build your career in either a private or a public sector or even a government sector company. MBA focuses on important commerce subjects such as economicsEconomicsEconomics is an area of social science that studies the production, distribution, and consumption of limited resources within a society.read more, accountingAccountingAccounting is the process of processing and recording financial information on behalf of a business, and it serves as the foundation for all subsequent financial statements.read more, marketing, and operations, along with other optional subjects that the candidate would like to pursue. The candidate can use the optional subject for personal or professional requirements. The most exciting part of the MBA is its internship program that the candidate can pursue in a company; this guides them to the right and required job opportunities after completing their course.

CFP and MBA Exam Requirements

CFP

Requirements for examination:-

  • This examination does not need to be taken as it is a two-day exam for approximately 10 hrs with many multiple-choice questions.The examination window opens in March, July, and November in different locations.If you are not good at studying or have difficulties understanding the subject, please seek guidance as you need to pay the examination fee.

MBA

  • After clearing a GMAT or a GRE test, the candidate can seek admission to an MBA institute.MBA is a 2-year program followed by graduation.An internship is a part of this program.In some institutes, only candidates with professional experience can apply.

Why Pursue CFP?

If client management is on your mind and you are also good at planning finances for your clients, that is their money, you must complete CFP as it will add value to your career by boosting your talent and know-how skills. In addition, you can work for individual clients by handling their financial goals by guiding them through legal restrictions, financial laws, investment and tax planningTax PlanningTax planning is the process of minimizing the tax liability by making the best use of all available deductions, allowances, rebates, thresholds, and so on as permitted by income tax laws and rules imposed by a country’s government. It contributes to better cash flow and liquidity management for taxpayers, as well as better retirement plans and investment opportunities.read more, insurance and benefits, etc.

To understand the client better, you need to understand his financial requirements. For that, you need to understand the client’s business better. To do so, you need to prepare a background, do a little homework by interviewing the client, know about his finances, incoming and outgoing money, prepare a financial plan for your client, execute the plan accordingly and finally monitor the plan’s outcome. That’s the financial planner’s moral responsibility,

CFP gives you the option of working as a self-employed, or in an organization as a financial advisor. These organizations can be insurance companies, banks, mutual fund Mutual Fund A mutual fund is a professionally managed investment product in which a pool of money from a group of investors is invested across assets such as equities, bonds, etcread morecompanies, or AMCAMCAn Asset Management Company (AMC) refers to a fund house, which pools money from various sources and invests the same in purchasing capital on behalf of their investors.read more.

Why Pursue an MBA?

To add value to your existing career, an MBA is just perfect. Even if you are a fresher and have just passed out of an MBA institute, you definitely will start your career well. MBA is added value to your career, and to your education. Besides giving you the option of choosing your specialization, MBA also trains you in economics, accounting, operations, and marketing in depth. The internship is an important part of the MBA, giving the candidate the corporate world exposure required as most of the students need to join a company to know and live in the work culture.

Conclusion

The decision between CFP vs. MBA can be made easier if you are clear on what genre of knowledge you wish to pursue. The answer lies between financial planning and management. The scope gets restrictive to financial planning with CFP and wider with management in MBA. Please make your choice wisely, keeping in mind all that we discussed above.

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