By Amber Kevin
Finishing a financial planning degree is just the first step for many budding finance professionals in Australia. For those aiming to reach the pinnacle of financial planning expertise, securing Certified Financial Planner (CFP) certification is often the ultimate goal. This globally recognised credential is a symbol of excellence and ethical practice in financial planning. By achieving your CFP certification, you demonstrate a commitment to the highest standards of professionalism and client service.
Here’s a detailed guide on how to become a Certified Financial Planner in Australia:
1. Complete a Relevant Formal Education
To be eligible for CFP certification, candidates must first complete a financial planning degree or equivalent, ensuring they have a comprehensive knowledge base required in areas such as tax, retirement, estate planning, and risk management. In Australia, this now means obtaining an approved degree that meets the standards set by the Treasury Laws Amendment (2019 Measures No. 3) Act 2019 which introduced the Financial Adviser Standards (FAS). The standards are enforced by the Australian Securities and Investments Commission (ASIC), which oversees the accreditation of educational institutions and the courses they offer.
2. Gain Professional Experience
Once your educational qualifications are secured, you’ll need to accrue professional experience. For CFP certification, a minimum number of years working directly in financial planning or a related role is typically required. This work experience allows aspiring CFPs to apply theoretical knowledge to real-world scenarios, dealing with client needs and navigating complex financial systems.
3. Complete Additional Advanced Courses
After achieving your financial planning degree and gaining necessary work experience, taking additional advanced courses in financial planning is the next step. These courses, offered by various Australian educational institutions, cover in-depth topics in financial planning and ensure that candidates meet the required competency standards as set by financial planning authorities.
4. Pass the CFP Certification Examination
The CFP certification examination is a comprehensive test that covers a wide range of financial planning topics. It aims to assess candidates’ ability to apply financial planning knowledge to real-life situations. The exam is rigorous and requires extensive preparation, covering case study analyses and scenario-based questions.
5. Commit to Ongoing Education and Adherence to Ethical Standards
CFP certification isn’t just about passing an exam, it also entails an ongoing commitment to learning. Certified professionals are expected to maintain and expand their knowledge through continuing professional development (CPD). They must also adhere to strict ethical standards that govern their professional conduct, ensuring they provide the highest level of financial advice to their clients.
6. Engage with a Professional Body
In Australia, engaging with a professional body associated with financial planning is an important step. Such bodies facilitate the certification process and provide necessary resources and advocacy for the profession. They also enforce the ethical standards and professional requirements that CFPs are expected to maintain throughout their career. One of the biggest in Australia is the Financial Advice Association Australia (FAAA).
Achieving CFP certification is a testament to your expertise and dedication to your career in financial planning. It is a significant investment in your professional future that can open doors to advanced career opportunities and increased trust from clients. By following the essential steps outlined above, from completing your financial planning degree to passing the certification exam and committing to ethical excellence, you’re on the path to becoming a leader in the Australian financial planning community. It’s a challenging but rewarding pursuit that sets you apart in the finance industry.
