CFA Vs 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 CPA is a very important topic of discussion which deals with two different but very prestigious certifications in the field of finance. Their differences lie in the scope of study, focus and career. They also differ in the kind of client they deal with.

CFA is a certification that is awarded by the CFA Institute, and it is recognized globally. The professionals are very highly regarded with the most rigorous credentials in the world of investments. It deals in various fields like financial analysis, portfoilio management or evaluation of investments. In the CFA program, there are a wide range of topics such as ethics, economics, financial analysis, equity investments, derivatives, fixed income, etc. The study involves three levels, that increase in complexity level and if cleared, it makes the candidate an expert in the financial field. It gives training regarding theoretical as wel as practical application of every kind of financial concept.

CFP on the other hand is granted by the CFP Board, which is a comprehensive course which certifies that the candidate who clears the exam, is a professional who is very well equipped with the skill and knowledge to provide financial services. The services are particularly for individuals and families and may range from retirement and estate or property planning to insurance, taxation and building a profitable investment portfolio. The financial advice that these types of professionals provide is very holistic and of high standard.

To summarise, both the above courses are highly regarded and recognized in the financial market, even though they cater to different aspects of the industry. CFA is more focussed towards analysis and management whereas CFA is more inclined towards planning and providing financial solutions.

Let us try to understand the two concepts with the help of infographics as given below. This makes the the differences and process of remembering very easy and less time consuming.  

The comparative table given below compares the two certifications on the basis of different criterias like the organizing body, the course duration, syllabus, fees, exam type, jobs and career opportunity, CFA vs CFP difficulty level, etc. It is interesting to learn them based on these segregations and get a very clear idea of the same.

One of the most important questions that come to our mind is – which is a better option out of CFA and CFP? This also leads to the question of CFA vs CFP which is harder. 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. Both are highly regarded in the financial market and the professionals are believed to have the best level of skill and competence to deal with their respective clients, because the courses provide training opportunity that are comprehensive and thorough. So, let us dive in deeper to understand the two designations in more detail in the following sections.

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.

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.

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, , it is not easy to understand that CFA vs CFP which is harder, because there is a flexibility to combine education and professional experience, sequential and not overlapping, to meet the 4-year requirement.

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 reporting 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. Therefore the CFA vs CFP difficulty level is worth accepting because of the high level of learning involved in them.

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.

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 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%.

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.

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.

Therefore, the candidate should try to analyse their field of interest, skills and career expectations before selecting the type of course they want to study. It is very important to do this at an early level so that they get the time to become competent in their respective fields and start a successful career early in life.

It is a guide to what is CFA Vs CFP. We explain which is better along with infographics, comparative table, skills obtained, duration & eligibility. If you wish to evaluate other financial certifications, you can also checkout –

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