The CFP Board (also known as the Certified Financial Planner Board of Standards, Inc.) is a non-profit organization in the United States that acts as the gatekeeper for the prestigious Certified Financial Planner (CFP) designation. Think of it as the 'board of governors' for financial planners. Its mission is straightforward but vital: to benefit the public by setting and enforcing high standards of competency and ethics for personal financial planning. The Board doesn't work for financial advisors; it works for you, the consumer. It ensures that anyone who has “CFP” after their name has jumped through some significant hoops to prove their knowledge and, most importantly, their commitment to putting your interests first. This dedication to a higher standard of care makes the CFP Board a crucial pillar of trust in the often-confusing world of personal finance.
The CFP Board's main job is to maintain the integrity of the CFP certification through a framework often called “the four E's.” This rigorous process ensures that certified individuals are well-equipped to handle your financial future.
The Board establishes the specific requirements a professional must meet to earn and maintain the right to use the CFP mark.
In a world filled with financial titles and acronyms, the CFP mark is a clear signal that an advisor is committed to a higher standard of professionalism and ethical conduct.
When you're entrusting someone with your life savings, you want to be sure they are both competent and trustworthy. The CFP certification is one of the best tools an ordinary investor has to vet a potential advisor. It tells you that the individual has a proven, broad-based knowledge of financial planning and has voluntarily agreed to be held accountable to a strict ethical code. Choosing a CFP professional can help you filter out sales-focused agents and find a true partner for your financial well-being.
The CFP Board makes it easy for the public to leverage its work. Their website (cfp.net) offers a free tool that allows you to:
From a value investing perspective, working with a CFP professional makes perfect sense. The philosophy of legendary investor Benjamin Graham is built on discipline, a long-term perspective, and a deep understanding of one's own financial situation—the “know thyself” principle of investing. A great CFP professional helps you build the unshakeable foundation upon which a sound investment strategy can be built. They help you manage your overall financial picture—cash flow, debt, insurance, and long-term goals—so you can focus on the specific task of finding undervalued businesses to invest in. They aren't there to give you hot stock tips. Instead, they provide the comprehensive, objective financial plan that ensures you have the discipline, patience, and financial stability to be a successful value investor over the long haul. In essence, they manage the “personal finance” so you can master the “investing.”