CFP Exam Prep

The Certified Financial Planner (CFP) designation is a great way for financial advisers to differentiate themselves from their competition. Being a CFP provides a boost in credibility and can open up additional career opportunities. The exam is administered by the Certified Financial Planner Board of Standards. It is a rigorous test that will require intense studying to pass. The passing rate is typically between 50-60%, so don’t plan on passing without some major CFP Exam prep.

While there are a number of steps to becoming a CFP, the 10-hour exam is certainly the biggest hurdle. The CFP Exam is offered three times per year in approximately 50 locations throughout the U.S. The 10-hour test is divided into three sessions. Session 1 is on Friday afternoon and lasts for four hours. It has 115 questions, which includes a case study. Sessions 2 and 3 are on Saturday and are both three hours long. They each have 85 questions and a lengthy case study. All questions are multiple-choice including the questions that pertain to the case studies.

Seven topics are covered on the CFP Exam. They are listed here along with the percentage of the test questions that you should expect on each topic:

1.) General principles of financial planning (11%).
2.) Risk management and insurance planning (14%).
3.) Employee benefits planning (8%).
4.) Investment planning (19%).
5.) Income tax planning (14%).
6.) Retirement planning (19%).
7.) Estate planning (15%).

The important thing to note is that even the least covered topic still makes up 8% of the exam. While it is important to be extremely well versed in retirement planning and investment planning, you still need to study extensively in all topics.

In preparing for the exam you will want to start with a comprehensive set of CFP study material. As you read through the material you should focus on the areas that you are the least familiar with. After several sessions with your book it will be time to dive into sample questions and sample cases. We have a free CFP practice exam to get you started. Work through as many practice questions as possible, focusing on the questions and topics that you are having the most trouble with. It is critical that you understand the exact explanations for each question, not just the right answer. There is nothing wrong with taking a break from a practice test to review the topic in greater detail. As your scores on the practice exams begin to get into the 80-90% range you will know you have done enough CFP Exam prep.

The scoring method of the actual CFP Exam is unusual because there is no set percentage that is required to pass. Instead, your results are measured against an established competency level for each topic. In addition, the exam is statistically calibrated with past exams to compensate for different levels of difficulty. The bottom line is that you should not stress out if the questions are harder than you anticipated. Carefully work through them and answer them all to the best of your ability. By following these tips you should be able to pass the exam on your first attempt. It will take a lot of time and effort, but the CFP certification is great accomplishment that will provide a boost to your career for many years to come.

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