If you have ever met with a financial advisor, it is likely that they have several letters after their name. As a consumer, it is important to understand exactly what these designations mean – they are not all the same and they do not all indicate the same type of expertise or accomplishment. Some require the completion of specific coursework and ongoing continuing education, some just require an advisor to pass a test, and others require a candidate to take courses, pass an exam, meet certain experience requirements and adhere to stringent ethical standards. Two of the more coveted designations in the investment world are the Certified Financial Planner® (CFP) and the Chartered Financial Analyst (CFA).
What is a Certified Financial Planner?
A Certified Financial Planner® is a professional who, in addition to having a bachelor’s degree, has completed extensive training in personal financial planning, passed a 6-hour comprehensive exam, met work experience requirements and adheres to high ethical standards. In addition, a CFP® commits to 30 hours of on-going continuing education every two years. A CFP® professional is uniquely qualified to coordinate all aspects of an individual or family’s financial situation; whether it be cash flow planning and budgeting, tax planning, retirement planning, investment management, estate planning, risk management or education funding.
What is a Chartered Financial Analyst?
The Chartered Financial Analyst (CFA®) credential is one of the most respected designations in finance and is widely considered to be the gold standard in the field of investment analysis. After completing a series of enrollment requirements, a CFA candidate must successfully pass three six-hour long exams in sequential order. Most successful candidates take an average of four years to earn the designation and log more than 1,000 hours of rigorous study. The CFA program involves a rigorous and in-depth dive into the field of investment analysis and portfolio management and prepares candidates for careers in either personal or institutional investment management.
Why Do Credentials Matter?
While a CFP® focuses on the big picture and offers a comprehensive approach to financial advice, a CFA charterholder is an expert in the art and science of security analysis, quantitative methods, asset allocation, and portfolio management. Although CFA charterholders are not trained in comprehensive financial planning, they do have the ability to work effectively with tax and estate planning experts to offer a more holistic approach to wealth management.
At Core Wealth Management, the breadth of experience and level of expertise offered by our professionals makes us uniquely qualified to advise families and individuals on their wealth management needs. In addition to years of experience in the wealth management arena, Todd Schanel, Principal and Director of Investment Advisor Services, holds the CFP® designation and is also a CFA charterholder. Jackie Goldstick, Director of Financial Planning, holds the CFP® designation.