One of the most in-demand well-paying jobs in the U.S. isn’t in Silicon Valley or on Wall Street, and you can train for it with an online course.
It’s a subject close to my heart — I’m pursuing it myself.
Financial advising is a fast-growing field that’s expected to soar in demand as fewer American workers have pension plans and find themselves navigating their financial futures on their own. One way into this career path is to become a certified financial planner. It’s a popular choice for career-switchers in their 30s and 40s. (I’m not leaving my job as a personal-finance reporter; I’m studying to be a CFP to add to my own knowledge of the hidden pitfalls of retirement planning.)
“They decide they want the credibility, competency and confidence — or even the additional compensation — that comes with CFP certification,” said Kevin Keller, chief executive officer of the Certified Financial Planner Board of Standards. CFPs make a median salary of $66,000, according to PayScale. Comparatively, the median household income in the U.S. was $61,372 in 2017, according to the U.S. Census Bureau.
If you’re thinking of going down this road, here’s what you need to know:
A growing field
There were nearly 272,000 financial advisers in the U.S. in 2016, and that figure is projected to grow 15% by 2026, according to the Bureau of Labor Statistics. That compares to 7.4% job growth overall.
There are more than 200 designations, certifications and accreditations within the financial services industry. Of all the financial advisers in the U.S., 82,000 or 30% are certified financial planners.
See: Give your money only to financial advisers who fit your needs, not theirs
Advisers with the CFP letters after their names have completed the educational component, either online or in person, as well as a six-hour multiple choice exam on general principles, insurance and risk management, taxes, retirement, investments and estate planning. They must also complete 6,000 hours of professional experience. (My four years as a financial reporter count). You also need a bachelor’s degree before you can get your CFP certification.
Where to get started
I used Boston University’s online CFP program, which gave me access to the content for almost two years, plus quizzes, exams and a capstone, just like you’d get in person. I chose an online program because I work full-time in the city, and I wanted my weekends free to spend with family and friends.
As for the review course, which many professionals recommend taking before taking the exam, I took a hybrid approach. All of the content I need is available online, as well as hundreds of quizzes, but I also sat in a classroom for four days between 8 a.m. and 6 p.m. to review everything on the exam (and probably much more).
How much it costs
The educational requirement alone could cost somewhere between $3,000 and $10,000 (or more for those who pursue a bachelor’s or graduate degree in financial planning), according to Michael Kitces, a financial adviser and blogger behind Nerd’s Eye View.
Online courses are typically less expensive than in-person. For example, at Boston University, the online course is about $4,725, whereas the classroom version is $6,665. The exam is another $600. To maintain the designation, you must pay annual dues, and take continuing education classes.
The entire process of becoming a Certified Financial Planner takes time too. I’ve been working on it for the last two and a half years, but the average is anywhere from a year and a half to two years, Keller said. Just 12 months may be pushing it, he said.
What you’ll need to succeed
For the online path to work, you’ll need good time-management skills and self-motivation, said Timothy Neuville, a financial adviser at Marcum Financial Services in Irvine, Calif.
Neuville wrote curriculum for both online and in-classroom programs at UC Irvine, and said both programs have their benefits. With online courses, you obviously save time commuting and can be more flexible with your schedule. In a classroom, you can ask professors questions face-to-face and receive immediate feedback. You also get the benefit of meeting classmates, which helps you grow your professional network.
Know this: Online classes are easy to ignore, something I learned from personal experience — and others know to be true too. “Let’s face it, procrastination is easy with online classes because you go at your own pace,” said Monica Dwyer, a financial adviser at Harvest Advisors in West Chester, Ohio.
Still, online courses can be the right fit. Adam Van Wie, formerly in sales and now a financial adviser at Van Wie Financial in Jacksonville Beach, Fla. said he chose an online program after deciding to switch careers.
“I traveled a lot, so I could study, submit homework and even take tests on the road with just an internet connection,” he said. He also had young children, and his schedule wouldn’t allow for the extra time a classroom-based program requires.
Online doesn’t work for everyone. Autumn Campbell of Tulsa, Okla. took classes in-person. “I considered doing online, but didn’t have anything else in my life to augment what I was learning in the classroom,” she said. “I thought that building personal relationships with my peers and teachers would be helpful.”
As for the review course for the exam, she did that online. She took 11 three-hour review courses over the span of a few weeks, as opposed to a few days in the classroom. “I felt that based on how the brain works, I would retain more by spacing out the review,” she said. Campbell previously worked as a teacher and high school counselor and became a CFP this year. She’s also president-elect of the Financial Planning Association’s NexGen, a community of professionals 36 years old or younger in the financial planning industry.
Also see: Stay away from these 3 types of financial advisers (and that’s coming from an industry insider)
Be ready for a serious exam
The exam is six hours (with a 40-minute break) and has 170 multiple-choice questions. People typically spend about a year and a half preparing for it. And sometimes people have to take it more than once. Some questions are straight-forward, whereas others ask the test taker to strategize on behalf of made-up “clients.” For example, “Kevin is in the 42% marginal tax bracket (combined federal and state). Kevin wants to contribute $100,000 towards his child’s education in the next three years. Which of the following approaches minimizes his taxable gift?”
About 60% of first-time test takers passed the Certified Financial Planner Board of Standards exam last July. The exam is administered three times a year — March, July and November — and average pass rates are usually in the mid-to-high 60s.
I decided to take classes for the CFP more than two years ago because I wanted to add another dimension to my work as a personal-finance reporter. It’s important for me to easily translate financial jargon to our readers and make financial planning as transparent as possible so more people can benefit and make informed decisions about their own future.
When I talk to advisers and tax consultants, I’m familiar with these complex subjects. I love helping my friends and family come up with debt repayment plans, figure out the best retirement account to invest in and talk about meeting financial goals — and I want to do the same for our readers. Hopefully, I’ll have the CFP certificate this winter to do just that.
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