explanations of professional designations

CFP® – Certified Financial Planner™:

The CFP® certification is a voluntary certification; no federal or state law or regulation requires financial planners to hold CFP® certification. It is recognized in the United States and a number of other countries for its (1) high standard of professional education; (2) stringent code of conduct and standards of practice; and (3) ethical requirements that govern professional engagements with clients. Currently, more than 88,000 individuals have obtained CFP® certification in the United States.

To attain the right to use the CFP® marks, an individual must satisfactorily fulfill the following requirements:

  • Education –Attain a Bachelor’s Degree from an accredited United States college or university (or its equivalent from a foreign university) and complete CFP Board-approved coursework. CFP Board’s financial planning subject areas include insurance and risk management, employee benefits, investment, income tax, retirement, education and estate;
  • Examination – Pass the comprehensive CFP® Certification Examination. The examination, administered in two 3-hour test sections in one day, includes case studies and client scenarios designed to test one’s ability to correctly diagnose financial planning issues and apply one’s knowledge of financial planning to real world circumstances;
  • Experience – Complete at least three years of full-time financial planning-related experience (or the equivalent, measured as 2,000 hours per year); and
  • Ethics – Agree to be bound by CFP Board’s Standards of Professional Conduct, a set of documents outlining the ethical and practice standards for CFP® professionals and complete a background check conducted by the CFP Board.

Individuals who become certified must complete the following ongoing education and ethics requirements in order to maintain the right to continue to use the CFP® marks:

  • Continuing Education – Complete 30 hours of continuing education hours every two years, including two hours on the Code of Ethics and Standards of Conduct, from an approved provider to maintain competence and keep up with developments in the financial planning field; and
  • Ethics – Renew an agreement to be bound by the CFP Board’s Code of Ethics and Standards of Conduct. The Code prominently requires that CFP® professionals provide financial planning services at a fiduciary standard of care. This means CFP® professionals must provide financial planning services in the best interests of their clients.

CFP® professionals who fail to comply with the above standards and requirements may be subject to CFP Board’s enforcement process, which could result in suspension or permanent revocation of their CFP® certification.

CPA – Certified Public Accountant:

CPAs are licensed and regulated by their state boards of accountancy. While state laws and regulations vary, the education, experience and testing requirements for licensure as a CPA generally include minimum college education (typically 150 credit hours with at least a baccalaureate degree and a concentration in accounting), minimum experience levels (most states require at least one year of experience providing services that involve the use of accounting, attest, compilation, management advisory, financial advisory, tax or consulting skills, all of which must be achieved under the supervision of or verification by a CPA), and successful passage of the Uniform CPA Examination.

In order to maintain a CPA license, states generally require the completion of 40 hours of continuing professional education (CPE) each year (or 80 hours over a two-year period or 120 hours over a three-year period). Additionally, all American Institute of Certified Public Accountants (AICPA) members are required to follow a rigorous Code of Professional Conduct which requires that they act with integrity, objectivity, due care, competence, fully disclose any conflicts of interest (and obtain client consent if a conflict exists), maintain client confidentiality, disclose to the client any commission or referral fees, and serve the public interest when providing financial services. The vast majority of state boards of accountancy have adopted the AICPA’s Code of Professional Conduct within their state accountancy laws or have created their own.

CFA® – Chartered Financial Analyst®:

The Chartered Financial Analyst® (CFA®) charter is a globally respected, graduate-level investment credential established in 1962 and awarded by the CFA Institute — the largest global association of investment professionals.

To earn the CFA charter, candidates must:

  • pass three sequential, six-hour examinations;
  • have at least 4,000 hours completed in a minimum of 36 months of qualified professional investment experience;
  • join CFA Institute as members; and
  • commit to abide by, and annually rearm, their adherence to the CFA Institute Code of Ethics and Standards of Professional Conduct.

To learn more about the CFA charter, visit www.cfainstitute.org.

CDFA® – Certified Divorce Financial Analyst®:

The Certified Divorce Financial Analyst® (CDFA®) designation is issued by The Institute for Divorce Financial Analysts (IDFATM), which is a national organization dedicated to the certification, education, and promotion of the use of financial professionals in the divorce arena. Founded in 1993, IDFATM provides specialized training to accounting, financial, and legal professionals in the field of pre-divorce financial planning. Over the years, IDFATM has certified more than 5,000 professionals in the U.S. and Canada as Certified Divorce Financial Analysts® (CDFAs®).

The CDFA® designation is available to individuals who have a minimum of three years experience as a financial professional, accountant, or matrimonial lawyer. To acquire the designation, a candidate must successfully pass all exams and be in good standing with their broker dealer (if applicable) and the FINRA/SEC or other licensing or regulatory agency.

To earn the designation, the participant must complete a series of self-study course modules and pass an examination for each module. The American module topics are:

  • Financial and legal issues of divorce;
  • Advanced financial issues of divorce;
  • Tax issues of divorce;
  • Working as a CDFA®: case studies.

Continuing Education (CE) – To retain the Certified Divorce Financial Analyst® designation, a CDFA® must obtain fifteen divorce-related hours of Continuing Education (CE) every two years, remain in good standing with the IDFATM, and keep his/her dues current.

To learn more about the CDFA® designation, visit www.institutedfa.com.

CTFA – Certified Trust and Fiduciary Advisor:

The CTFA designation is awarded by the American Bankers Association (ABA) to those who apply for and meet the following requirements: (1) a minimum of three (3) years’ experience in wealth management, defined as direct experience in the furtherance of delivering fiduciary services related to planning and advice, asset management, trusts, estates, IRAs, qualified retirement plans, and custody services; (2) completion of an ABA-approved wealth management training program; and (3) adherence to the ABA’s Professional Code of Ethics statement. The CTFA is maintained by ongoing adherence to ABA’s Professional Code of Ethics and completion of 45 credits of continuing education every three years.

AEP® – Accredited Estate Planner®:

The Accredited Estate Planner® (AEP®) designation is a graduate level specialization in estate planning, obtained in addition to already recognized professional credentials within the various disciplines of estate planning. It is awarded by the National Association of Estate Planners & Councils (NAEPC) to estate planning professionals who meet stringent requirements of experience, knowledge, education, professional reputation, and character.

AEP® applicants are required to be members of, and continuously maintain membership in, an affiliated local estate planning council. The applicant must sign a declaration statement to continuously abide by the NAEPC Code of Ethics. The applicant must satisfy a minimum of thirty (30) hours of continuing education during the previous twenty-four (24) months, of which at least fifteen (15) hours must have been in estate planning.

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