It's Just Money

Passing the CFP exam

Since announcing that I passed the CFP exam, I have received requests for advice on passing the exam.  So, I'll do my best, but everyone's experience may differ.  Here you go Zook.

First, let me explain how I went about the process.  I began the process without a sense of urgency.  The company that I was working for neither paid for the classes, nor was very supportive about it.  They were strict money managers, and financial planning was viewed as an elaborate ruse to get people to buy life insurance.  Ignorant, I know.  But they are very old school.

So, watching my budget, I went with the online only classes through the College for Financial Planning.  It was cheaper than any actual classroom version.  Besides, the "at your own pace" sounded attractive.  Initially, I went at it pretty diligently.  I had some friends who were studying at the same time, so we formed a small group to keep each other on track.  However, as they began to drop off, that support dissolved.

From the time that I enrolled, to the time that I took the test, it was almost two years.  In my opinion, too long.  See, I thought that my prior experience in financial services would allow my to walk through the coursework in the self study mode.  It turns out that there is a tremendous amount of detail that is covered, and knowing what to study is probably the most important thing of all.

After finally completing the coursework, I enrolled in a CFP Exam Review course.  There are courses offered by a host of companies, some with classroom, some without.  Here, in Los Angeles, there are two ladies, Linda Hewitt and Nancy LeClair, who teach classes at UCLA extension, and UCI extension.  They are a two weekend, Friday, Saturday and Sunday deal.  It's not cheap, something like $1,200, but man it's worth it.

They take all that you have studied, and say, "okay, don't worry about all that, here's what you need to know, and here's how you should approach the test."  They have been teaching CFP classes for years, so they know what to expect, and they know how to prepare you.  This was the most important thing that I did.

So, what I would have done differently. 

CFP Exam Results Have Been Posted

Last Wednesday I get an email.  "Status of Results for the CFP(R) Certification Exam."

Holy crap.  How long has it been since I took the test?  Well, damn, that's easy to figure.  It has been as long as the time since my last post on this blog.  Immediately after the test I was relieved, and anxious to know whether all the work was worth it.  Did I pass?!!!  Dang CFP board, why does it take so long to post the results?

Well, weeks go by.  Months, actually.  Well, almost two months.  All kinds of craziness has gone on, and I have been a bad, bad blogger.  Am I going to get back into updating the blog?  We'll see.  I'm hoping to.  I hope many of my blog friends are still active.  Jim, Mapgirl, 2Million?  I'm talking to you guys.

Back to this CFP test stuff.  You know when you are studying hard with a singular focus, and that singular focus passes, it's awfully difficult to continue the studies.  Why should you have to?  Well, what if you don't pass?  Then what?  It's two months since you picked up a book, and now you have two months to cram for the test again?  Ouch.

So, all along I'm thinking, "maybe I should keep studying.  I mean, it's good stuff to know anyway.  And worst case scenario, I don't pass, but I'm really on track to take it again right away."  But are you kidding me?  I'm just not that guy.

As it was, two months goes by.  I have been using much of my newfound financial planning knowledge on a daily basis, but the stuff that you need to know for the test?  hardly.  I know all along that I'm in for a dreadful next two months if I have to retake this madness.

I'm going about my business.  The anxiety of wanting to know the results has really gone to the back burner.  I'm not studying, not thinking much about it.  Then my world gets rocked with one email subject line, "Status of Results for the CFP(R) Certification Exam."

Inside, it goes on to say that the results will be posted by the end of next week.

You bastards.  You sent me an email to tell me that I have another week to be nervous?

Well, that week ended today.  This time the email subject line read, "CFP(R) Certification Examination Results Posted."  Yikes.  I think I just missed a heartbeat.

I click on the email, follow the link to the login page, and wait for the site to load.  And I wait.

And I wait.  And I wait.  And I... well, go get some lunch.

And I wait.  Yea, I'm hitting Refresh, and all the stuff that you are supposed to do.  But you have everyone trying to login at the same time, you see.

I call my Fiancee, and now she's all nervous for me.  I tell my co-workers that the results are posted, but I can't get to them. Now they're all nervous for me.

I go in to a client meeting.  I come out and try to login... and I wait.

I'm doing some work, and I notice that my browser isn't searching.  Like it found what it was looking for:

"Secure CFP Board Account Login"

I type in my username, and password, and click "go."  And I wait.  And I wait.  "You piece of sh-" and it loads!

"Welcome!" it reads.  "Congratulations Mr. (my name).  You have Passed the July 20-21, 2007 CFP® Certification Examination. The next requirement for CFP® certification is to provide evidence that you hold a bachelor's degree (or higher) from a regionally-accredited U.S. college or university."

Sweet.

LAMoneyGuy, CFP(R)

Taking the CFP Test Tomorrow!

Hey folks, I just realized that I haven't posted in over a month!  Yikes, didn't mean to neglect the blog that much.  I'm taking the CFP exam tomorrow and Saturday.  I have been spending all of my off hours preparing for the test.

Nothing I hate more than blog posts that apologize for not posting.  But there you have it, my apology and my excuse.  I'll report all about the exam after I'm done.  Also, I would have done some things differently in the course work.  I'll tell you about that as well.

Wish me luck!

Reader e-mail: Advice on becoming a Financial Planner (CFP)

I received this email from reader, Christy, regarding a career change to financial advisory:

Hello. I saw your email and advice on a forum and was wondering if you would be willing to advise me.  My name is Christy and I am 31 years old and will be graduating with my MBA in December. I have four children (young ones) and am looking to return to the workforce after being off for a year and a half. I have fourteen years of accounting experience and am wondering if I should become a financial advisor. I do not have ANY sales experience but I am a likealbe person and a very hard worker. I interviewed with Merrill Lynch and have been given the opportunity to go through their training program. I am not sure if this is what I want to do. I need advice. I want to know if anyone has worked for them and also if this is the best company to go through? I also am curious to what the actual job entails? How many hours do I really have to work over 40 and would working my forty plus maybe a Monday night and Saturday morning would do? Also, would it be more feasible to just go get a job or do this? Any advice would be greatly appreciated?
Thanks
Christy

I have received similar emails inquiring about the CFP exam and about starting a career in financial planning, and will provide my response to Christy below.  My advice won't apply the same to everyone, because Christy's situation is not the same as most.  If anyone else who has any experience in the financial services, financial planning, investment management, etc. business can add anything I, and I'm sure Christy, would appreciate it.

My response:

Phew! I passed

That was kind of nerve wracking.  I really didn't feel adequately prepared for this one.  I passed the test for the second of five classes in preparation for the CFP boards exam.  This test was on Investment Planning.  I did well on all of the conceptual questions, but I didn't spend enough time doing formulas and calculations.  The problem with those is not the difficulty, but if you are not familiar enough, you will likely screw up your math somewhere.  Luckily somewhere around the middle of the test most of the questions became mostly of the conceptual variety.

The next class starts tonight.  The third class is on Income Tax Planning.  No rest for the weary!

Also, thank you to everyone who wished me good luck!

I'm taking the CFP Test #2 this morning

Yikes, I don't think I prepared as much for this one as I did last time.  This is the second of five classes required through the College for Financial Planning that I must pass before sitting for the comprehensive boards and officially call myself a Certified Financial Planner designee.  If you're interested you can read my post on the steps required to become a CFP.

This particular test is on Investment planning.  You would think this is one that I should not have any problem with, but there are a lot of details and formulas and such that I'm not sure I spent enough time on.  Oh well, here we go.

Wish me luck!

How to Become a CFP

Peter Griffin:  "Brian, there's a message in my Alphabits!  It says, 'Ooooo'"
Brian:  "Peter, those are Cheerios."

Unfortunately, the alphabet soup that is the business of financial planning/selling investments is quite a bit more complicated than Peter's Alphabit cereal.

How do I become a CFP?  Should I become a CFP?  What about CFA?  ChFC, CLU, CMFC?  Should I take the series 7?  There are likely more varied certifications and desnigations in the business of financial planning, and all other professions that loosely fall under this category than any other industry.  The reason for this seems to stem from a business that is highly regulated, but also highly divergent.  There are insurance people, estate planning attorneys, stock brokers, financial planners, investment advisors, and others who call themselves vague titles, such as, "financial consultant."  It's okay, that was once my title.  You're not supposed to know exactly what it means.  All of these professions may overlap, compete, collude, or one person can be all of the above.

Insurance salespeople may sell mutual funds, variable annuities, or bonds.  Estate planning attorneys may sell insurance, annuities, or financial plans.  Stock brokers may sell life insurance for estate planning purposes, limited partnerships, or wrap manager accounts.  Of course, each requires another license, certification or designation.