Chartered Financial Consultant designatio

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dude's picture
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Do any of you have any input on the differences between the CHFC and CFP designations?  I understand that the CHFC is more common in the insurance industry, but has a similar curriculum to the CFP.
Thanks.

downtown's picture
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The course work is basically the same. I think the CHFC requires a couple more courses than the CFP.

anonymous's picture
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Downtown is correct.  Usually, one would get their CLU followed by a ChFC.  The classes are identical to the CFP, except that there are three additional classes.  There is not a comprehensive final exam.

Registered Rep's picture
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anonymous wrote:Downtown is correct.  Usually, one would get their CLU followed by a ChFC.  The classes are identical to the CFP, except that there are three additional classes.  There is not a comprehensive final exam.
If the coursework is basically identical, why do you think the CFP is so much more highly regarded than the ChFc?

ribsnwhiskey's picture
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anonymous wrote:Downtown is correct.  Usually, one would get their CLU followed by a ChFC.  The classes are identical to the CFP, except that there are three additional classes.  There is not a comprehensive final exam.

anonymous's picture
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"why do you think the CFP is so much more highly regarded than the ChFc?"
More highly regarded by whom? 
People who understand what both entail, don't agree with the above question.  The CFP does a better job of testing someone's test taking ability.  CLU/ChFC entails having to take more classes.
The truth is that very few of the public cares about either designation and even fewer know the difference.  The only one's who care are financial journalists (and we know that they don't know squat) and CFPs.
CFP has simply done a better job at marketing.
A ChFC is never going to lose business to a CFP simply because of the designation and the reverse is also true.

Cougzz's picture
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I got the CLU/ChFC/AAMS/CASL designations and got the most out of the
CLU classes. The Chartered Advisor for Senior Living is relatively new but
represented good coursework. The Accredited Asset Management Specialist
designation was basically financial planning by comic book...worthless. I am
studying for the CFP. I did in fact lose a client to a CFP. It was not because
he had a more recognizable designation, but that he held himself out as a
fiduciary...which I am not. I have a friend that wanted the CFP and took the
American College classes. As long as he had the tests done, he picked up
the ChFC and the CFP. In professional Canadian insurance circles the
preferred U.S.A. equivalent designations are LUTCF, CLU, CFP. In this country
the CFP marketers do a superior job of promoting their "brand". The ChFC
folks are late to the promo party but picking up the pace.

anonymous's picture
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Good post.

troll's picture
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anonymous wrote:
"why do you think the CFP is so much more highly regarded than the ChFc?"
More highly regarded by whom? 
People who understand what both entail, don't agree with the above question. 
I understand what both entail and I do agree with the above question. Sliding through the classes is nothing, passing the comprehensive exam to prove that you can handle all the material is another matter altogether.
 
 
 

anonymous's picture
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The CFP is harder to attain because of the comprehensive exam, but it does not make someone a better planner than a CLU/ChFC. 
Real world financial planning is open book.  We don't need to have all of the information memorized.  We just need to know where to find it.
CFP is better because there is a difficult comprehensive exam.CLU/ChFC is better because there are more classes.
Clients don't know the difference and if they did care about credentials, they wouldn't care about which one someone had.

san fran broker's picture
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I think that the CFP does have substantial advantages over the other major designations with the exception of the CFA.
The CFP is frequently mentioned in the financial press and is discussed on both the SEC and the NASD website, where the ChFC or the other major designations are not mentioned.
At some point, the public will become aware that there are several designations that are very easy to earn and others that are very hard. The CIMA and the CFA are not in the same neighborhood.
The only reason that I feel the CFP doesn't have a substantial advantage over the CFA is because research analysts are increasingly having them and putting it after their name on firm publications. Eventually, everyone under 50 in research at any major house will have that designation.
I hold the CFA designation and plan to "challenge out" of the classes for the CFP and go straight to the test in November (you can do this if you have a CFA, but not vice versa). I took the CFA curriculum because it is harder, tends to be the designation that UHNW financial advisors hold out here (generally its John Smith, CFA, CFP(r) on their cards) and because I didn't want to structure my life around classes for the next eighteen months (I know that they have accelerated programs now.)
I suspect that in 10 years, not having a CFP putting yourself out as a financial advisor will be like being an accountant without a CPA. I suspect that over time, the other designations will whither away or consolidate. My firm pays for and bonuses around the CFP(they won't for the CFA because its too much work and is less applicable to general financial product sales), but it doesn't pay for the ChFC or any other designation. It seems to be generally supportive of the CIMA (what all of the old guys went and got when letters started to become important), but doesn't put real support behind it in any real way.
As increasing numbers of brokers earn the CFP and CFA, my guess is that they will also encourage public awareness. Once a critical mass start to earn it, my guess is that they will move towards having the designations enshrined somehow through regulation. I think it's possible that one will come to wish that they earned one of the more "mainstream" designations in the coming years.
In short, I think it does matter and I would recommend getting your CFP.

troll's picture
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anonymous wrote: <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
The CFP is harder to attain because of the comprehensive exam, but it does not make someone a better planner than a CLU/ChFC. 
“Better planner” is a tough one to quantify. What I would say is that the CFP is vastly harder to attain, and that’s not because people fail the comprehensive exam at around the 50% rate because they fail to memorize the material, it’s because they’re required to use that material for the first time in a comprehensive manner.
anonymous wrote:
CFP is better because there is a difficult comprehensive exam.CLU/ChFC is better because there are more classes.
Again, my only problem with that is the underlying classes and exams are laughably easy and don’t denote an ability to actually use the material. They’re much more of a “check the box” sort of thing. The standard to earn the mark is too low.
anonymous wrote:
 
Clients don't know the difference and if they did care about credentials, they wouldn't care about which one someone had.

I think that depends on what sort of clientele you deal with. It’s been my experience that clients associate CLU/ChFC with insurance salesmen, and it’s never a good thing to be associated with insurance salesmen in a client’s mind. That’s why after I took the additional courses from the <?:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />American College to get the ChFC I didn’t have it added to my business card.
 
(Nomex suit  donned)
 

anonymous's picture
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"It’s been my experience that clients associate CLU/ChFC with insurance salesmen,"
You lose credibility when you make statements like this.  First of all, clients don't have a clue what a CLU/ChFC is.  Secondly, unless they are in the industry, why would they equate Chartered Financial Consultant with life insurance?  Finally, how the heck would this ever come up in conversation in the first place?
The CFP might have meaning in the future, but it doesn't have that much now.  I'm not arguing against it.  I think getting it might be a good idea.  As things stand today, however, it won't get you a client and not having it won't cost you a client.  It's not much better than an ABC designation.  The consumers don't know the difference.  You want clients?  Learn to prospect.  Learn to sell.

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anonymous wrote:
"It’s been my experience that clients associate CLU/ChFC with insurance salesmen,"
You lose credibility when you make statements like this.  First of all, clients don't have a clue what a CLU/ChFC is.  Secondly, unless they are in the industry, why would they equate Chartered Financial Consultant with life insurance?  Finally, how the heck would this ever come up in conversation in the first place?
The CFP might have meaning in the future, but it doesn't have that much now.  I'm not arguing against it.  I think getting it might be a good idea.  As things stand today, however, it won't get you a client and not having it won't cost you a client.  It's not much better than an ABC designation.  The consumers don't know the difference.  You want clients?  Learn to prospect.  Learn to sell.

You're painfully naive if you don't understand that educated and informed people do associate CLU and ChFC with life insurance salesmen.
If you're bright all you have to do is see the letters on a life insurance salesman's card once or twice and you can determine that those letters must have something to do with being a life insurance salesman.
Do you agree that most people would rather be administered an enema in public than spend an evening with a life insurance salesman?
 

anonymous's picture
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NASD, why do you have to comment on things that you know nothing about?   You've never in your life had a conversation with a client about this.  Either have I.  I'm naive because in over a decade, the subject has never, ever been addressed by a client.
 

troll's picture
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anonymous wrote:
"It’s been my experience that clients associate CLU/ChFC with insurance salesmen,"
You lose credibility when you make statements like this. 
If you say so. My experience has been that clients notice that the only place they've ever seen CLU/ChFC is after an insurance salesman's name.
anonymous wrote:
The CFP might have meaning in the future, but it doesn't have that much now. 
It's funny how often you hear that from guys who don't have it. Again, I think it depends on who your client base is.

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People who are CFPs think that it is important because the CFP brings it up with the client and then the client says, "ooh that's nice".
Clients rarely bring it up and it's very easy for a ChFC to say, "I chose to take 3 additional classes to become a Chartered Financial Consultant instead."  Clients bring up the subject about once a month.  I explain that I am not a CFP because being a CFP doesn't allow me to do anything for my clients that I can't already do for them.  I then explain that I am affliliated with both a B/D and an RIA so we can choose whether to go the commission route, the fee route, or a combination based upon what is best for them.
If it matters, I will finish my CLU/ChFC material in the spring and I may or may not sit for the CFP.   The CFP will have to bring some value to the table.  The last thing that I need is another organization telling me what I can and cannot do with my practice.

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anonymous wrote: <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
People who are CFPs think that it is important because the CFP brings it up with the client and then the client says, "ooh that's nice".
You assume the CFP brings it up first, and that's just not my experience. The public is aware of what a CFP is and the kind of people I deal with are fully aware.
anonymous wrote:
Clients rarely bring it up and it's very easy for a ChFC to say, "I chose to take 3 additional classes to become a Chartered Financial Consultant instead." 
I don't doubt that insurance guys do that. I was commenting on being an FA with what's often seen as an insurance guy designation behind it. I don't see that as a good thing. Should a client ever say to me "what's the diff between CFP and ChFC (and none ever have) I won't hesitate to point out the details, including the comprehensive exam and pass/fail rates.
anonymous wrote:Clients bring up the subject about once a month.  I explain that I am not a CFP because being a CFP doesn't allow me to do anything for my clients that I can't already do for them. 
You figure they buy that? If so, you have no reason to take the time for either a ChFC or a CFP designation since neither will "allow" to do anything aside from using their designation. If your clients are like mine they’ve been told often enough by various sources to seek out a CFP to know an excuse when they hear it
anonymous wrote:I then explain that I am affliliated with both a B/D and an RIA so we can choose whether to go the commission route, the fee route, or a combination based upon what is best for them.
That may work, but I suspect most will realize that just side-steps the issue of competency and demonstrated mastery of some of the more involved concepts and practices of wealth management.
anonymous wrote:
If it matters, I will finish my CLU/ChFC material in the spring and I may or may not sit for the CFP.   The CFP will have to bring some value to the table.  The last thing that I need is another organization telling me what I can and cannot do with my practice.

Got a real example of the CFP board telling you what someone can or can't do in their practice? I've been a CFP for years now and I've yet to see it.
 
You know, this discussion reminds me of hearing non-Rangers talk about how earning the tab “doesn’t mean anything”. You never heard a guy who had it say that.  ;)
 
 

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All of this, by and large, is off topic.  My point is that most people don't give a crap.  People do business with advisors primarily because they respect the person that gave the referral.  None of this other stuff matters.
Do you really think that successful business people think to themselves,  "USA Today says I need a CFP.  Money Magazine says I'm supposed to buy term and invest the difference. Consumer Reports says that I should wait to buy long term care insurance after I start to develop health issues.  Suze Orman says "people first, then things, then money".  I'll just follow their advice.  They no better than my attorney of the last 10 years who says I need to meet with MikeButler222 or NASDNewbie or San fran broker.
Whichever of the three of you who the attorney refers business  will get the business because of the respect that the client has for the attorney.  Your designations or lack of them mean nothing. 
 

anonymous's picture
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They know better.  I don't want the grammar police to spend their precious time going after me.

hubbabubba's picture
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"Your designations or lack of them mean nothing"
 
This is where I definitely disagree with you anon.  Its not the designation.  Its what you do with the knowledge.  I'll take the knowledge gained by studying from a designation (only a couple mean sh*t, but CFP is one of those) rather than the, um, 'knowledge' one has from only holding a series 7/66.

troll's picture
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anonymous wrote: <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
 My point is that most people don't give a crap. 
My point is "most people" may be true, but I don't do business with "most people". "Most people" don't have the assets or the need. Among those with the assets and the need CFP means something.
anonymous wrote:Do you really think that successful business people think to themselves,  "USA Today says I need a CFP. ....
Most that I encounter seem to say to themselves "There seem to be a million people who want to be my "financial advisor", but some seem to have an experience level and a proven expertise in this area. I’ll seek out one of them”.
 anonymous wrote:
Your designations or lack of them mean nothing. 

 
If you really believe that you’ll end your ChFC studies tomorrow…
 

anonymous's picture
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hubbabubba,
My point is that the client doesn't care in this situation.
It doesn't sound like you are disagreeing with me.   I agree that knowledge is of vital importance.  Holding a 7/66 does not mean that one knows enough.  In fact, this simply is the minimum that one must have to start their career.
A CFP is helpful and one certainly has to have a baseline of knowledge in many areas to pass.  Having a CFP is certainly something to be admired, but I'd  take an experienced producer's knowledge over a newly minted CFP any day of the week.  Any knowledge that someone has is good. 
 

anonymous's picture
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Mikebutler,
You are kidding yourself if people with assets and needs care whether someone is a CFP.  I know 5 $10,000,000 + producers.  None of them have CFPs. 
I have found very infrequently people who care, but they tend to be do it yourself types anyways.
You quoted me without the context with the "designations meaning nothing."  They mean nothing compared to the respect of the person giving the referral. 
Having vs. not having a CFP will not change ones income.  Regardless, one needs the knowledge to do a good job.  One should always be pursuing knowledge.  Both the CFP and the ChFC are worth pursuing.  At the present time, in very few instances does the client give a crap.

hubbabubba's picture
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you can call me hubba, for short, but that's not my real name
I feel like I'm going back and forth here.  I definitely think the CFP is the more highly regarded designation (compared to CLU/ChFC).  However, I'd rather see someone go for that combo than just have the 7/66.  I do think taking the comprehensive exam is important though.  It shows that you can bring different concepts together. Whichever route one goes, it shows the client, or at least it should, that the rep is taking their business seriously.
As much as I hate to admit agreeing with Newbie, I do think of "insurance guy" when I see CLU.  99.9% of 'insurance guys' (IMHO) are not "investment guys".  I don't want insurance guy touching my portfolio. Period.  Maybe that's just my perception, but I guess that's what we're talking about here. 
I think your distinction between an experienced producer and a new CFP is not accurate.  Most people who obtain the CFP have been in the business for awhile so aren't they experienced?
 

troll's picture
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anonymous wrote:
Mikebutler,
You are kidding yourself if people with assets and needs care whether someone is a CFP. I know 5 $10,000,000 + producers. None of them have CFPs.
And I know 500 $ Kablipptiy-blop producers who are left handed, therefore there aren't any right-handed types who are big producers AND I can tell you going forward this won't change....
Has it ever occurred to you that the marketplace for financial advice has changed since the days your big producer pals established themselves and people growing their career now would be wise to take notice of that fact? Come to think of it, I don’t think I know a single big hitter who isn’t a CPA, CFP or CIMA, or some combination of the above.
I’m not here to tell people just starting out that life will be a bowl of cherries if they only get the CFP, I’m saying get it when you can (and the earliest is three years) because that will be a minimum level of expertise going forward in this industry. Why NOT seek out the credentials of a professional? It’s not as if you have the choice “Gee, should I be a 30 yr in the biz experienced guy, or should I study for the CFP”.
anonymous wrote:I have found very infrequently people who care, but they tend to be do it yourself types anyways.
It's funny how often we hear that, and how it's always someone who isn't a CFP saying it....
anonymous wrote:You quoted me without the context with the "designations meaning nothing." They mean nothing compared to the respect of the person giving the referral.
It's almost as if you think getting that referral source to begin with has nothing to do with the qualifications and experience you presented to that person when you met them.
 
anonymous wrote:
Having vs. not having a CFP will not change ones income.
Right, because well, clients never cross-shop and there’s never been any mention in the financial press of the value of a CFP or the experience and academic effort required to earn it.
anonymous wrote:
Regardless, one needs the knowledge to do a good job. One should always be pursuing knowledge. Both the CFP and the ChFC are worth pursuing.
I’m going to go out on a limb here and say that basic knowledge aside, getting a ChFC and adding it to a business card is a bad idea for someone trying to be an FA. Those of us in the biz know how much of a joke it is to get past the class exams and too many clients will get the whiff of insurance salesman from it. JMHO, YMMV
anonymous wrote:
At the present time, in very few instances does the client give a crap.

Again, we’re going to have to agree to disagree, and I’ll disagree after I note how your experience is skewed since anyone seeking a CFP has simply not taken the time to meet with you. I with meet people regularly who said it made a difference in their decision process.
It’s like a 5’11” center prospect saying no team that’s met with him has made an issue of his lack of height. Well, of course, if they saw an issue with it they didn’t take the time to meet with him to point it out.

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Most of the public isn't trained to care to choose or not choose a CFP. The way they will learn is if there is a big marketing push by an organization or B/D that having a CFP gives you an advantage in sophistication. It has worked its way into the psyche of a very small segment of the population and will increase over time.

The people that currently seek out CFPs now are generally "well read, intelligent types" They think they are getting a more sophisticated investor/advisor with a CFP and better advice. They keep up with the wallstreet journal, kiplingers, smart money, etc and pride themselves being smart enough to look for an advisor with a CFP. They "interview" brokers by following that cosmo-like five step list they read in those magazines on how to choose an investor/broker. They are often the same person that likes those managed accounts where the fees are really high, but they interpret they are getting something better than the normal public does on their money. They may brag at cocktail parties that their monies are wrapped up in institutional accounts that most people can't invest. They also may brag that they don't pay commissions.    They have decent amounts of money but not tons. But they want others to think they have tons. This .05% of the population can be lucrative clients. They end up paying the highest fees through these managed accounts and wrap accounts which can make for a nice recurring income to the advisor. Suckers.   

Unfortunately, we will run into problems when the rest of the uneducated (stupid) public starts requiring CFP designations for their advisors. They will require it when they don't even understand what it stands for because they heard it off the radio or saw it on Oprah. It will probably become so darn frustrating to advisors with out it they will just have to get it so they can compete. NASDNewbie is correct in previous post, it is going to be huge in the future. Better start studying...world is a changing.

troll's picture
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Ok so I'll pose an alternative question-I'm currently studying for the CFP, and will take the test either in November or March.  I simply haven't decided which test date.Once I pass the test(thinking confidently), I *think* I will be able to get the ChFC with just a few more classes.  Is it worth it to go and get the second designation?

anonymous's picture
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Joe, yes it's worth it, but not because of the designation.  If you have the CFP, you don't need the ChFC.   The information is worthwhile.
It would not surprise with the Merrill rule if advisors who have the CFP designation have to stop using it on their cards, etc because it implies "planning" when they are operating as registered reps and not advisors.

troll's picture
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joedabrkr wrote:Once I pass the test(thinking confidently), I *think* I will be able to get the ChFC with just a few more classes.  Is it worth it to go and get the second designation?
As I mentioned before, I took the additional classes from the American College, but as CE credit for the CFP, and I'd never add the designation to my card. YMMV

troll's picture
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anonymous wrote:
It would not surprise with the Merrill rule if advisors who have the CFP designation have to stop using it on their cards, etc because it implies "planning" when they are operating as registered reps and not advisors.

I would surprise me since the vast majority of advisors with CFPs have a series 66 (ore equivalent) under their belt, often act as advisors in the technical sense and can charge for planning services.<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

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Joe,<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
I would get the CLU over the ChFC, but like some have said, don't put it on ALL of your cards.  It would be nice if you had it on a separate set of cards that you use for certain professional relationships.  However, I don't think it will EVER help you unless you are doing insurance related business. 
I'll be honest; the ChFC has very little relevance in our market anymore.  The CLU can still carry a little weight when working on the insurance side of things. 
I'm sorry that some of you resent that our clients (our being those who are CFP's) are well read intelligent types.  Personally, I think a lot of them view the CFP as a MINIMUM to be able to work with them.  Sadly, a lot of these well read intelligent types don't need the kind of help a lot of advisor want to give them.  They would do as good of a job on their own.  So the more sophisticated clients seek out an advisor who has a better chance of knowing more than they do.  The odds of finding that person are increased when using the CFP as criteria. 
That doesn't mean that you can't know everything and be better than a CFP, so don't everyone get their panties in a wad.  But statistics would have to prove that the odds of finding a competent advisor would only increase when looking only at CFP's. 
 

downtown's picture
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Ribsnwhiskey,
Well said.

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