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Does the school matter when it comes to getting a CFP mark?

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It’s commonly believed that getting a degree from the right institution may help you get a leg up after graduation.

It’s perhaps no great surprise then that people looking to obtain a CFP certification are conditioned to wonder what the best or top-ranked CFP programs are, particularly since many of the largest CFP education degree programs are completely unknown outside of our industry.

Yet in the end, most consumers choose their financial advisor based on a connection with the individual, not his/her academic pedigree. This means that finding a program where you can do well, actually internalize the content and be able to confidently apply its lessons is what really matters.
I heard recently from an aspiring CFP named Chad, who had a great sense of the program landscape, but was stuck with analysis paralysis about the right program to pursue between the American College (where his firm had a discount deal), the College for Financial Planning in Denver, and Boston University’s CFP program.

Chad was favoring B.U. — even though it would the the priciest path to earning his mark — precisely because B.U. has name recognition outside the advisory field. But Chad was struggling to figure out whether it was worth paying a premium for the B.U. name on his CFP educational certificate to get access to better job opportunities in the future.

Ironically, this question is not so different from the anxiety experienced by clients in our firm planning for the future college education of their children. Even if the kid’s just two years old, many want a financial plan that starts out assuming their kid going to go to Harvard, Yale or Stanford —because they believe the academic pedigree is valuable to their child’s future job opportunities.

But in the end, does going to the right school really give you a leg up on your planning career?

While it may feel compelling to obtain a CFP educational certificate from a prestigious institution, I’ve found that most potential clients simply don’t care where you earned it. And I say this as someone who earned his CFP mark from the American College, that same institution that Chad equivocated over for having virtually no name recognition outside of our industry. Clients haven’t heard of it? Usually true.
But it doesn’t matter.

In fact, it’s been 15 years since I finished my CFP education, and I think the grand number of times I can recall a client asking where I got my CFP mark is … two. When it happened, I simply responded: “Well, I took my CFP classes from the American College. They’re not actually well-known outside of our industry. But they’re the longest-standing higher educational institution that teaches financial advisors. They’ve been doing it for almost 100 years.”

To which the client invariably responds, “Oh, OK.” And we move on.

If your desired advisory niche is Harvard alums, then try to get a degree from Harvard. Short of that scenario, clients by and large couldn’t care less from where your mark were issued.

And the phenomenon isn’t unique to financial advisors. Think about how this topic affects other professionals. Do you ask your doctor where they got their medical degree? Would it matter if they said the University of Washington rather than Harvard? Would it matter if I told you that according to U.S. News & World Report, the University of Washington ranks No. 1 for primary care physician training — and Harvard doesn’t even factor in the top 10?

The point is that most people have no idea what the top schools actually are, especially when it comes to any kind of graduate level or professional education beyond just the big name-undergrad institutions. And as a result, many clients just don’t ask. Or will comfortably accept whatever you answer and explain.

The American College originated professional education for advisors, the CLU program, almost a century ago. The College of Financial Planning is the longest-standing CFP educational program in existence, having offered the first class of CFPs 45 years ago. (The college was actually part of the CFP Board for its first 13 years, splitting in 1985 to become what we now know as College for Financial Planning and CFP Board.)

A school’s alumni association can provide contacts, but that’s really not a function of the educational content.

Of course, if your marketing strategy is to network through the school’s alumni association, then your alma mater matters a little more. But it’s still not about the educational content per se. Rather, that lends itself to a niche marketing strategy. If your desired advisory niche is Harvard alums, then try to get a degree from Harvard. Short of that scenario, clients by and large couldn’t care less from where your mark were issued.

The bottom line: If you’re proud of getting your CFP mark and it gives you expertise and confidence that you can put into practice, you’ve gleaned the primary benefit of a CFP education.

All that being said, to land a job as a paraplanner or an associate planner, where you earn your mark can matter — a little.

When an advisory firm hires a new advisor straight out of a CFP program, there isn’t much to go on. Your grades, maybe some extracurriculars … and where you went to school. In that context, studying in a known CFP program might help a bit. If you’ve got Texas Tech or Virginia Tech on your resume — schools that are known to have very reputable CFP programs — it casts a little positive halo. You may earn the benefit of the doubt.

That being said, this will probably only get you through the first stage of screening process and an initial interview. It’s not going to get you the job. The leading advisory firms are increasingly hiring for passion, with the assumption that they can train the skills … which means they don’t look much at your alma mater to make a final decision. And the same is true when we’re hiring for paraplanners and associate planners at New Planner Recruiting. We hire for passion. We try to identify raw talent. We barely look at a candidate’s alma mater.

If you’re proud of getting your CFP mark and it gives you expertise and confidence that you can put into practice, you’ve gleaned the primary benefit of a CFP education.

In part, this is because good students come from programs all over the country. Our industry is not so hypercompetitive that the top talent only goes to a handful of schools — effectively creating feeder channels directly to advisory firms’ HR departments. We know this because we see it in practice: Good talent can come from literally anywhere.

Far more valuable and interesting to firms than where you learned is what you learned. Our firm actually administers a fake CFP test that we created, and the score is based on how many questions a candidate gets right, not which school taught him or her the answers.

There is one other case where your alma mater may matter: If you plan to go into academia and teach. Even there, it’s still not about where you earned your CFP mark —i.e., those six core classes, which are really undergrad equivalent content — but where you received your master’s degree or Ph.D. After all, you’re not competing for consumers’ minds here. You’re competing in academia, where some schools do care about the academic pedigree of their professors.

That being said, even within academia, I’m still skeptical about how much this matters.

Because so many schools are just starting up CFP programs, they are simply not (yet) ultra-selective. They’re more interested in hiring people who have good teaching skills, the ability to represent the program well and maybe help build out the offering with their fundraising connections.

Some schools are more strict about their instructors’ academic pedigree than others, especially when graduate-level financial planning is in a business school. Which matters, because the CFP Board is trying to push growth now in business schools, and those programs tend to hire professors who earned degrees from other AACSB-accredited business schools. It’s fair to recognize, then, that the Ivory Tower, where you received an advanced degree, could matter.

Still, many of the new Ph.D. job opportunities in recent years were awarded to recent Ph.D. graduates, to help build out programs. School pedigree may have shown up here as a factor, but probably not a driver of the hiring decision.

For most people looking at a CFP education, here are my four tips for selecting a program that fits:

1. Educational Curriculum: What classes and electives do they offer? Are the electives relevant and appealing to you? Which school makes you feel most excited about the learning you’ll do?

2. What’s the learning platform? Is it a virtual program where you’re going to be at a distance, or is it in person? Do you thrive with in-person instruction, or would you rather study online? Which aligns best with your learning style?

3. Which one fits your schedule? The truth is sometimes it just comes down to scheduling and convenience. “Hey, I found a cool program, but they teach on Tuesdays, and I can’t do Tuesdays because I got stuff with my kids. I can do Thursdays, so I’m going to do this other program.” Or, “I’m going to do a virtual one that’s asynchronous so I can study on the weekends, and it doesn’t matter when the classes are.”

The biggest determinant of success is how well you learn the material and how confidently you can apply its lessons.

4. Which one fits your budget? Costs do vary from one program to another, and financial need should factor in your picking the best CFP registered program. Again though, the biggest determinant of success is how well you learn the material and how confidently you can apply its lessons.

We’re beginning to see research that bears this out, vis-a-vis the value of a CFP education. No one is citing the academic pedigree of their program. Rather, study participants talk up the content of their educations. “It gave me expertise to help my clients more,” they say, or “It gave me confidence to talk to my clients more effectively.” The right program equips you to deliver good business results. That’s ultimately what matters.

So what do you think? Has anyone ever asked where you got your CFP education? Do you think it matters where you get your CFP education? Are there any special circumstances when where you got your education really might matter? Please share your thoughts in the comments.

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