CFP® vs CFA®

The former is a professional designation for financial planners, while the latter is a credential for investment professionals

Author: Jackson Hartz
Jackson Hartz
Jackson Hartz
Jackson Hartz is a fourth-year Economics major at the University of California, Los Angeles (UCLA). Hartz is also the author of “Building Your Financial Future: A Practical Guide for Young Adults” which was featured as a #1 hot new release in Amazon Personal Money Management books. He has been published in the California Business Journal and is the founder of the Financial Literacy Group at UCLA.
Reviewed By: Josh Pupkin
Josh Pupkin
Josh Pupkin
Private Equity | Investment Banking

Josh has extensive experience private equity, business development, and investment banking. Josh started his career working as an investment banking analyst for Barclays before transitioning to a private equity role Neuberger Berman. Currently, Josh is an Associate in the Strategic Finance Group of Accordion Partners, a management consulting firm which advises on, executes, and implements value creation initiatives and 100 day plans for Private Equity-backed companies and their financial sponsors.

Josh graduated Magna Cum Laude from the University of Maryland, College Park with a Bachelor of Science in Finance and is currently an MBA candidate at Duke University Fuqua School of Business with a concentration in Corporate Strategy.

Last Updated:January 24, 2024

What Is CFP® vs CFA®?

CFP (Certified Financial Planner) is a professional designation for financial planners, indicating expertise in financial planning. CFA (Chartered Financial Analyst) is a credential for investment professionals, signifying advanced skills in investment management and analysis.

Both certifications enhance credibility and demonstrate a commitment to excellence in their respective fields.

Many people who want to enter the world of finance and investing question whether they should pursue a certified financial planner (CFP) or a chartered financial analyst (CFA) designation.

This decision is crucial to one’s career because they are both time-consuming goals and require significant studying and professional work experience.

It is important to consider the possible career opportunities each path opens. 

The certified financial planner certification typically involves comprehensive financial planning, including managing a client’s finances, designing financial goals, and offering various financial services in the client’s best interest. 

The chartered financial analyst qualification often leads to a career in investment decision-making, including roles in investment banking, risk analysis, portfolio management, and other diverse financial sectors.

Below is a podcast with the CEO & Founder of Wall Street Oasis, Patrick Curtis, discussing the CFP and the CFA with one of his mentees, Victor. We learn why he is planning to get both designations for credibility.

    While both paths open new doors for career development, another option is to pursue neither certification. This may be a more cost-effective choice for some individuals, allowing them to allocate time to other activities or goals based on their unique career aspirations.

    This article will dive into:

    • What a CFP is and how to earn the certification
    • What a CFA is and how to achieve the charter
    • Key differences between the two designations

    Key Takeaways

    • CFP and CFA certifications lead to distinct finance career paths. CFP suits financial planners, emphasizing comprehensive planning, while CFA caters to investment professionals in roles like portfolio management and risk analysis.
    • Both designations require substantial commitment. CFP entails formal education, exams, work experience, and continuous learning. Similarly, CFA involves passing three levels of exams, relevant work experience, and ethical adherence.
    • CFP opens doors to client-focused roles like financial advisor, while CFA aligns with positions such as investment analyst or portfolio manager, emphasizing investment tools and risk management.
    • Considerable financial and time investments are needed for both certifications. CFA may have a higher cost and longer completion time, while CFP offers a relatively more accessible option in terms of both.
    • The choice between CFP and CFA should align with individual strengths, interests, and career aspirations. CFP suits those inclined toward holistic financial planning, while CFA is a better fit for those interested in quantitative analysis and investment strategies.

    Certified Financial Planner (CFP)

    Financial planners are responsible for managing a client’s finances with the client’s best interest in mind. This is also known as their fiduciary duty.

    Upon completing the exams offered by the Certified Financial Planner Board of Standards, Inc., an individual earns the title of a certified financial planner. Not only must you complete the initial exams, but you must also continue your learning by participating in annual educational programs.

    This yearly requirement ensures financial planners stay updated on industry changes, regulations, and best practices, contributing to their continuous professional development and competence.

    Earning this certification requires hundreds of hours of studying, demonstrating a comprehensive understanding of financial planning concepts through a rigorous exam. So even though becoming a CFP is difficult, the accreditation does open new career doors in the future.

    Some topics financial planners assist their clients with are:

    • Personal finances
    • Retirement
    • Investing 
    • Education
    • Budgeting
    • Insurance
    • Taxes

    Individuals tend to pursue financial planning if they enjoy helping others manage their finances. There is an ethical standard that certified financial planners must uphold, so they always have to be selfless and put the client first.

    What Do Certified Financial Planners Do?

    Finances can be difficult to manage for some people, which is why they seek the assistance of a financial planner. These planners essentially plan and organize the finances for every aspect of their client’s life.

    Financial planners will look at all financial information relevant to their clients, such as, but not limited to:

    • Cash
    • Assets
    • Investments
    • Properties
    • Liabilities

    Financial advisors will gather and analyze this information to estimate their client’s net worth. The client will work closely with the financial advisor to discuss their goals, concerns, and current financial situation.

    Some plans could include:

    • Paying for a child’s education
    • Buying a house
    • Opening a business

    Some concerns could include:

    • Rising inflation
    • Not enough savings
    • Too much risk in your portfolio

    Financial planners tailor financial plans with the age of the client in consideration. For example, a client nearing retirement and a client who just graduated college will have different financial plans.

    While some positions, such as investment advisors, have more defined roles, financial planners are generally all-encompassing.


    It is worth noting that some certified financial planners specialize in certain areas, such as divorce or retirement planning. Others may only work with a certain clientele, such as small-business owners or retirees.

    Financial planners are different from traditional financial advisors. Becoming a CFP requires more education and testing to ensure in-depth knowledge of financial planning.

    Certified financial planners are bound to an ethical code that ensures they are always acting in the best interest of their clients.

    CFPs can be paid fee-only or fee-based. Fee-based advisors receive a commission on certain services, while fee-only advisors collect a standard sum at their discretion for all services.

    How to Become a Certified Financial Planner?

    Becoming a CFP requires thousands of hours of work and education. There are four stages to earning your CFP designation.

    1. Formal Education

    To become a CFP, you must have graduated from an accredited university with a bachelor’s degree or higher, preferably in a relevant field such as finance, accounting, economics, or a related discipline.

    Secondly, there are financial planning course requirements that are considered prerequisites, but these can sometimes be satisfied by completing a certified financial analyst (CFA) program, being a certified public accountant (CPA), or holding a master’s of business administration (MBA) with a focus on financial planning.

    2. CFP Exam

    There are over 100 topics tested in the form of 170 multiple-choice questions. The general issues that are tested and their current weighting as of 2022 are:

    • Professional Conduct and Regulation (8%)
    • General Principles of Financial Planning (15%)
    • Risk Management and Insurance Planning (11%)
    • Investment Planning (17%)
    • Tax Planning (14%)
    • Retirement Savings and Income Planning (18%)
    • Estate Planning (10%)
    • Psychology of Financial Planning (7%)

    Prospective CFPs test in two- or three-hour periods during a single day. Exams are typically offered in March, July, and November.

    The test costs $925, but early applications have the potential for a discount, while late ones are subjected to a surcharge. The tests are not graded on a curve, and the performance of other individuals does not affect your score. There are two outcomes to the test: pass or fail.


    The overall pass rate in 2019 was 62%. If you fail the test, you can retake the test, but there is a waiting period between attempts, and you can do so up to four times over your lifetime.

    3. Relevant Work Experience

    Potential CFPs must complete their required hours of work experience, accumulating either ten years before applying to take the exam or five years after passing it. Note that the hours can span before and after your test.

    The hours of work experience requirement can be fulfilled by 6,000 hours of professional experience or 4,000 hours of apprenticeship.

    4. Demonstrated Professional Ethics

    The fiduciary standard is critical to the CFP designation, so prospective certified financial planners must maintain a spotless record of ethical behavior.

    Chartered Financial Analyst (CFA)

    The CFA Institute gives the chartered financial analyst designation. This certification is earned by passing the Level I, II, and III exams. These exams test ethics, money management, accounting, and security analysis.

    Each CFA exam level covers different content and has a distinct format. For example, Level I consists entirely of multiple-choice questions, while Levels II and III include essay and item set questions.

    The financial analyst exams are some of the most difficult, with Level III passing rates hovering around 9.5% over the past ten years. Pass rates for other levels may differ.

    While the exams are difficult, they are important as they ensure chartered financial analysts are knowledgeable in their field. This designation is world renowned because of its difficulty in earning. 

    CFA certifications began in 1963, and since then, more than 190,000 individuals have earned this designation by successfully completing all three levels of the exam. These analysts can be found in various industries across the globe, such as investment banking and risk management.

    What Do Chartered Financial Analysts Do?

    Individuals with CFA designations can be found in many financial and investment sectors. Some examples of industries are:

    Obtaining the financial analyst charter can significantly improve your resume when entering highly competitive fields such as investment banking or hedge fund management.

    Most CFA charterholders are employed at large investment banks and mutual fund companies. A slim portion of charterholders, around 5%, work as financial advisors.

    The CFA charter is often considered the most respected designation in finance. Yet, as a result of fewer than 200,000 people worldwide holding this designation, the hard work and countless hours of studying are recognized by companies. 

    The average total compensation for a chartered financial analyst is around $300,000.  

    The first exam costs $450, and the following two exams (Level II and Level III) cost between $700 and $1,000 each, depending on how early you sign up to take the test.

    It will likely take at least four years to earn your financial analyst charter because you can only take each test once a year. The Level I exam, however, is offered twice a year.

    How to Become a Chartered Financial Analyst?

    Earning the designation of certified financial analyst is not an easy task. Passing all three tests requires hundreds of hours of studying and years of work. There are similar requirements to the certified financial planner certification, but the CFA criteria are more intensive.

    Additionally, unlike the financial planner certification, a potential charterholder must have two letters of recommendation from professional sources. It typically takes a minimum of three years for a candidate to earn their CFA certification.

    There is an emphasis on ethical behavior, which requires analysts to maintain a moral standard in their work.

    Before starting the journey to earn your CFA, you should consider your current financial situation and career goals to ensure it is your right decision. Then, consider the financial and time commitment and decide if earning the charter will outweigh the potential drawbacks.

    Below are the requirements for earning the chartered financial analyst certification.

    1. Education Requirements

    A candidate must have four years of professional work experience, a bachelor’s degree, or be in their final year working towards their bachelor’s degree. Some other requirements include:

    • Possess an international passport
    • Must complete the exam in English
    • Meet the professional conduct admission requirements
    • Live in a country that offers the certification

    2. Testing Requirements

    Three tests must be passed in sequential order. The tests are difficult and require an average of 300 hours of studying per test.

    The Level I exam includes 180 multiple-choice questions and must be completed within the allotted four and a half hours. Some topics that are tested include:

    • Economics
    • Corporate finance
    • Portfolio management

    The Level II exam format is 22 small case studies and four multiple-choice questions per case study. In total, there are 88 questions. Test takers have 4 hours and 24 minutes to complete the exam, with a break halfway through. Some topics that are tested include:

    • Foundations of risk management
    • Valuation and risk models
    • Operational risk

    Finally, the Level III exam includes structured essays and 44 multiple-choice questions. The time limit for this final exam is 4 hours and 24 minutes. Some topics that are tested include:

    • Professional standards and ethics
    • Private Equity
    • Hedge funds & managed futures

    3. Relevant Work Experience

    Prospective CFA charterholders must complete a minimum of 4,000 hours of work experience over three consecutive years. The professional work experience must be relevant to investments and decision-making. 

    4. Letters of Reference

    Two to three letters of recommendation are also required for CFA certification. These letters must be from professional sources in the investment industry.

    CFP vs. CFA: Key Differences

    Various key differences between the two certifications may convince you to pursue one or the other or neither. Therefore, it is important to research to ensure that the course you decide is the best decision for you. 

    Every individual’s financial situation, career goals, and ambition is different. Your decision on whether to get a CFP or CFA should be based on what is most appropriate for your life or where you want to be in the future.

    While both certifications are geared toward general industries, it is typically a good idea to have a concrete plan for what you want to do once you earn the certificate. 

    Pursuing both paths is a time commitment and financial expense, so you mustn’t aimlessly study and take the tests. Both certifications are demanding and often open doors that previously were out of reach.

    While both are prestigious designations, each has its requirements and course content.

    Benefits CFA Charter CFP

    Organizing Body

    CFA Institute

    CFP Board

    Career Path

    Investment analyst, strategist, consultant, portfolio manager, wealth manager

    Financial planner/advisor, investment advisor, financial consultant, wealth manager


    Bachelor’s degree, Level I, II, III exams, 4,000 relevant professional work hours experience

    Bachelor’s degree, financial planning coursework, 4,000-6,000 relevant professional work hours experience


    Minimum $3,050-$3,950

    Minimum $825

    Completion Time

    3-5 years

    1.5-3 years


    Highly recommended for investment management careers

    Required for a career as a financial planner


    Investment tools, valuing assets, risk management

    Financial and investment planning


    Less than 10% pass the Level III exam

    62-66% pass rate

    Award for Completion

    Professional designation

    Professional designation

    Professionals (as of July 2022)



    Average Salary



    CFA vs. CFP: Which Is Right for You?

    If you want a career in helping people and working more closely with clients, a CFP certification could be a wise choice. For example, you work closely with clients in financial planning to help them achieve their financial goals.

    On the other hand, with a CFA designation, you may find opportunities to work for large investment banks or corporations, but the scope of roles extends beyond these areas. 

    It is worth mentioning that many financial analysts also work with clients but focus more on managing investment portfolios and complex investing strategies.

    CFAs typically excel in math and are more detail-oriented. Careers as a CFA often require quantitative analysis and honing in on a specific topic. Some skills that a CFA charterholder may have are:

    • Financial modeling skills
    • Analytical ability
    • Decision-making skills
    • Excellent communication

    CFPs have a more holistic approach and know a decent amount about various topics. Some traits of CFPs are:

    • Strategic thinking
    • Sales & Marketing
    • Relationship management 
    • Communication skills

    Both certifications require a lot of studying, and you can be sure that once you pass either test, you will know the respective topics. However, if you are more restricted with time, you may consider the CFP certification because it is less of a time commitment and contains fewer tests.

    There is no universally better option, but the choice depends on your career goals. For instance, the CFP course would be a better fit if you intend to become a financial advisor.

    Additionally, it is important to consider the syllabi for both designations. Research both options and decide which topics are more intriguing to you, considering that both certifications require a significant amount of study time for the exams.

    Also, neither path may be the best option for you. For example, financial advisors and investment bankers do not have these designations. However, these designations significantly improve your chances of landing a position in these fields.

    Make sure to research your options and align your decision with your current financial situation. While you may have ambitious goals, ensure you have the time and money to pursue either path.

    Researched and authored by Jackson Hartz | LinkedIn

    Reviewed and Edited by Hongmo Liu | LinkedIn

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