CFA vs CFP: What Is The Difference & Which Do You Need?

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  • CFA vs CFP: What Is The Difference & Which Do You Need?
Author: Joseph Reinke, CFA

Are you trying to decide between a Chartered Financial Analyst (CFA) and a Certified Financial Planner (CFP) for your personal financial planning needs? If so, you’re not alone.

Many people trying to hire a financial advisor are confused by the differences between these two finance credentials.

Both certifications require significant study and experience in order to become certified or chartered.

In this article we will compare and contrast the CFA vs CFP and detail the differences between these two designations in detail so that you can make an informed decision about which one best suits your needs.

First Things First: What Do Financial Advisors Do?

Financial advisors are experts in a range of financial services and products, including financial planning, asset management, retirement planning, investments and more.

They act as trusted advisors to individuals, families and businesses to help them realize their financial goals.

When it comes to personal financial planning, financial advisors may specialize in certain areas such as tax planning, estate planning or insurance advice. They also work with clients to create customized strategies that meet their unique needs.

To demonstrate their expertise and commitment to the profession, some advisors pursue certifications like the Chartered Financial Analyst or Certified Financial Planner.

Therefore, individuals with the CFA and CFP designation are professionals you should seek out for help when searching for a financial advisor.

What is a Chartered Financial Analyst (CFA)?

The CFA designation is one of the most highly respected and sought-after credentials in the finance industry.

It requires rigorous study through the CFA program, examination, and work experience before candidates can earn their CFA charter.

The CFA credential is awarded by the CFA Institute upon completion of the CFA program which consists of a rigorous three-part series of exams that tests candidates’ knowledge in economics, accounting, ethics and portfolio management.

The CFA designation sets its holders apart from those with other qualifications such as Certified Financial Planners.

Those who obtain the CFA certification demonstrate they have what it takes to excel in the field of finance.

They typically work in portfolio management or as a research analyst. A small percentage work in the personal financial planning and wealth management industries.

In short, a CFA excels in financial analysis and investment management.

History Of The CFA

In 1963, the profession was formalized when 284 candidates sat for the first CFA exam and 268 CFA charters were awarded.

The CFA designation is a professional credential that has been around since 1962. It was established by the National Federation of Financial Analysts Societies (NFFAS) in order to promote the exchange of ideas and support the welfare of financial analysts.

In 1963, 284 candidates sat for the first CFA exam and 268 charters were awarded. Today, there are approximately 170,000 Charterholders.

Even though it was officially launched in the 60’s, the education for the CFA and idea of it started much sooner.

In fact, Benjamin Graham (the individual that taught Warren Buffet) is credited with founding what would become the CFA designation.

General Requirements For Becoming A CFA

The CFA Institute runs the certification programs.

A Bachelor’s degree is required (or equivalent) along with four years experience (4,000 hours) with a financial institution.

Individuals must pass a 3 exams. Each exam is six hours long, you can only take it once a year, and you have to take them sequentially. I.e. If you fail an exam you have to wait another year to take it.

The initial exam focuses on knowledge and investments tools.

The second level exam focus on assets and emphasizes more complicated analysis.

The Third exam dives deeper into the topics from level one and level two but primarily focuses on financial planning.

The CFA recommends studying 300 hours per exam. However, most candidates that pass the exams state they study between 600 and 900 hours.

What Is A Certified Financial Planner?

The CFP certification is granted by the Certified Financial Planner Board of Standards (the CFP board) after an individual demonstrates expertise in six essential areas including taxatio, legal concepts, and investment management strategies.

To become a CFP, an individual must have at least three years of experience in the financial planning field, pass the 10-hour CFP exam, and adhere to a stringent code of ethics.

This comprehensive training ensures that individuals who receive the CFP designation are knowledgeable and capable in their financial planning practice.

As part of their services, CFPs provide guidance on various aspects related to managing finances. This includes retirement planning, investing strategies, education financing options, insurance solutions, and tax planning.

With the help of a qualified CFP, individuals can make smart decisions about their money and plan for their future needs.

Primary Area Of Focus

CFPs focus on personal financial planning and wealth management. Therefore, more CFPs are financial advisors than those that have completed the CFA program and obtained their CFA Charter.

In my opinion, the primary area CFPs excel at is estate planning and insurance planning.

General Flaw Of CFPs

Many CFPs that I’ve worked with do not understand all the information they need to in order to develop holistic financial plans.

For example, they may be really good with estate needs but lack knowledge in mortgages or student loans.

Therefore, they become more of a specialized solution for a piece of your financial plan.

I will also say that this is of no fault of their own.

The financial services industry and companies many CFPs work for compensate them in ways that they have to focus on certain financial areas in order to make a living.

Also, they are not trained in investment analysis and often times most hire a portfolio manager that specializes in portfolio management for their clients.

In addition, due to their area of studies, often times CFPs have only general knowledge in portfolio management, financial analysis, and investment analysis instead of expertise in these areas like a CFA would.

Which One Do I Choose To Use

The CFA is widely considered to be the best professional credential for those looking to gain an edge in the finance world.

The CFA designation is more comprehensive than a CFP certificate, as it requires a greater depth of knowledge and understanding of financial markets.

For example, if you are a CFA Charter Holder, you do not need to take the CFP course work. You can skip it and just sit for the exam.

In addition, you don’t have to hold government licenses such as the Series 7.

Why Can’t I Find A CFA To Work With?

Working with a CFA Charter Holder can be incredibly difficult to do, not just because they are in high demand, but also due to the cost associated with hiring one.

Most CFAs are employed by large funds such as hedge funds, mutual funds, investment banking, or financial analysis position. Therefore, unless you have a lot of money to invest, it is hard to find one that will work with you.

This is why FitBUX was created; it aims to bring the knowledge and expertise of CFAs to people from all walks of life.

By providing an affordable platform for financial planning, FitBUX allows users access to a wide range of financial services without having the prohibitive costs associated with CFA-level advice. Plus, FitBUX utilizes technology like machine learning and automated advice in order to provide more personalized recommendations than what could ever be achieved manually by a single financial advisor.

So, if you’ve been struggling to find a CFA who can provide you with quality advice within your budget, consider trying out FitBUX instead! It was created by two CFA Charter Holders.

Rapid Fire FAQ

Which is more prestigious CFP or CFA?

Global industry experts regard the CFA charter as the gold standard in the world of finance. Therefore it is considered to be more prestigious.

Is CFP harder than CFA?

Overall, it is shorter and less-rigorous as opposed to CFA programs.

Should I Use A CFA or CFP?

Depending on your needs, yes. Specifically, if you have a net worth over $5 million. Anything under that, you are probably better off using a technology such as FitBUX.


This wraps up our article comparing the CFA vs the CFP certifications.

Whether you’re looking for comprehensive financial planning or just specialized advice, the CFA and CFP certifications are both excellent choices which is why we have employees with both credentials working at FitBUX.

However, it can be difficult to find a qualified professional who has their CFA and fits within your budget.

Thankfully, FitBUX provides an affordable platform that allows users access to quality financial services without paying exorbitant fees.

With its machine learning and automated advice capabilities, FitBUX is sure to provide personalized recommendations tailored specifically for you. If you’re interested in trying out this revolutionary technology at an unbeatable price point, sign up today!

Joseph Reinke, CFA

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About the Author

Joseph Reinke is a Chartered Financial Analyst (CFA) Charter Holder and founder of FitBUX which has helped over 14,000 young professionals on their journey to financial freedom. Joseph has been personally investing since he was 12 years old.

In addition, he has experience in student loans, mortgages, wealth management, investment banking, valuation, stock trading, and option trading. He has been on 100s of podcast and has been invited to 100s of universities to discuss financial planning with their soon to be graduates.

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