The Problems With The CFP® Challenge Exam – A Response to the FPi Question

July 23, 2002

By Paul M. League, CFP^® – Then Chairman of Concerned Planners Group (6/1/2002 – 12/31/2003)
www.IAQFP.org / info@IAQFP.org
Laurie, your observations are indeed timely.

We have written the CFP Board several weeks ago requesting their rationale for allowing the “challenge”. You also know that we sent out a Press Release yesterday containing reference to this exact subject.

As you likely know this is a long-standing part of our Groups purposes (www.IAQFP.org) and is reflected on that page of our website as follows:

f. have the CFP Board require all persons, including related professionals like CPA’s & Attorneys who may wish to challenge the subject matter, to first have to take the full study curriculum, along with any related modular exams, prior to any “Comprehensive Exam”.
g. have the CFP Board formally grant use of the CFP^® designation to qualified ChFC’s (i.e. those who have met the minimum 3 year experience requirement, since the CFP Board has stated, in writing to our Group, that ChFC’s have already met seemingly equivalent education & examination requirements of CFP^® certification).

Lifetime experience, knowledge & subject familiarity does not necessarily equal formal education; therefore, a specific formal financial planning curriculum, along with exams (modular or “comprehensive”), is, in our view, the basic criteria.

We are the last one’s in support of any kind of a “giveaway”, but we do support a rational approach to determining qualified financial planners. Our Groups “Referral Registry” is reflective of such rationale.

We have “called” the CFP Board to act on their statement that pre-1991 ChFC meet equivalent education and exam to that of CFP^®. Neither they, nor the American College, have acted on this call to award such ChFC use of CFP^®. The only other required criteria are their 3-year experience requirement (which ChFC have already met), and finally adherence to the CFP Boards Code of Ethics, which, if one wants to use the Mark, one must follow. Therefore, these designations, as used, are equivalent in all 4 “E’s” – education, examination, experience, and ethics.

Tiring of these parties failure to act, we, as a separate Group of concerned and qualified planners, made the decision to accept BOTH pre & post 1991 ChFC into our Referral Registry, and as full fledged Members of our Group. Why also post 1991 ChFC? Because of the exact same rationale that we use to support pre-1991 ChFC.

The only difference that exists for post 1991 CFP^® certification is that this is the time when the CFP Board converted from their modular academic standard and tests, to their so called “raised bar” Comprehensive ‘Certification’ Exam.

There are many opinions about this “new certification standard” (i.e. as to whether or not it is substantively or meaningfully different, at least in terms of accurately testing for one’s educational understanding of the material), but it is our opinion that it does not reflect a “raised bar standard”, at least as far as education is concerned. For governmental “certification” standards there is a technical difference, which fits the CFP Boards interest in becoming the SRO of the field. There is also the $100 Registration Fee & $595 Exam Fee (charged again and again for each retake which is about 50% of the time!), and the $300 biannual Mark usage fee, which is more about revenue generation and increased CFP Board power & influence. These factors have little if anything to do with the knowledge of the subject matter of financial planning, and certainly even less to do with a designation conveying real qualification standards.

CFP^® Certificants need to get real, step down from atop the conceit mountain, and start to take constructive action against the CFP Board & the FPA’s attempt at corralling the financial planning profession under the CFP^® designation, as if they are, or it is, the be all and end all of the entire field of financial planning.

We offer the only focus and means to support our fellow planners in just such endeavors. It is our position that ALL ChFC, certain RFC, and others, are in fact as duly qualified as CFP^®. The only way we can make this a “practical reality”, despite the turf war resistance, is to do what we have done; namely, publicly announce that for our purposes, and for referrals to the public, these designations are in fact equivalent and will therefore be equally identified to the inquiring public upon request.

One day we would like to help the public by consolidating under one designation. Such a move would negate the solutions being offered by the FPA, the CFP Board, and others for SRO status, or lawsuits to weed out nonconformists.