Articles About Financial Advisor Personal/Career Development

The Certified Financial Planner (CFP) designation is one of the most respected credentials for financial advisors and the process to earn it is rigorous. Candidates must fulfill education, experience, and ethics requirements, in addition to passing the comprehensive CFP Exam, a 170-question, multiple-choice test taken across two 3-hour sessions in one day. Material on the CFP Exam is categorized into the CFP Board’s eight principal knowledge topics, which range from retirement savings and income planning to investment planning, professional conduct, and regulation. With a general recommendation that exam takers study for at least 150 hours before the exam, the cost in time and money of failing can be high. Furthermore, given that the exam covers a broad range of financial planning topics, having an organized and disciplined study routine is a necessity to pass the exam.

Accordingly, CFP exam review courses can be a good option to help exam takers not only review the material that will be on the test but also develop strategies for preparing for and taking the exam. The core of most CFP exam review programs is based on instructor-led review sessions that typically come with extensive pre-study materials, which can include condensed reviews of the principal knowledge topics and practice questions, as well as questions and mock exams to help exam-takers gauge their progress and practice in similar conditions as the actual exam. While the core elements of most CFP exam review programs are similar, they differ in their method of delivery, level of personalization, and cost. Instructor-led sessions for some programs can be held synchronously, either in person or livestreamed virtually, while others are held asynchronously, with recorded lectures available to view on demand. Some programs also offer more personalized instruction, from one-on-one video coaching to email access to instructors. Certain programs also offer students some form of exam-pass guarantee, which can range from being able to retake the program for free, to receiving a refund of the program cost.

With more than twenty different CFP exam review options to choose from, exam takers can methodically approach selecting a program by first deciding whether to take a synchronous or asynchronous program. While synchronous programs can be good for exam takers who want (or need) the structure of set schedules, asynchronous programs can be useful for those with unpredictable schedules and the discipline to complete the program on their own. Individuals can then consider other important factors (e.g., group size, guarantees, and cost) that are most important to them based on their preferred learning style and budget. As an alternative, exam takers with very tight budgets can choose a self-study approach using printed review materials and practice questions without the lecture component.

Ultimately, the key point is that while there is no single ‘best’ CFP exam review program that will be suitable for all test takers, those taking the exam can consider their individual situation to narrow the field of available programs. And while there is no guarantee that an individual will pass the CFP exam after taking a review program, these programs can greatly improve the quality and efficiency of the strategy the exam taker chooses when preparing for the exam. Which is important, because passing the CFP exam requires a high level of commitment and hard work – and finding the right method to review and prepare can make a big difference in helping prospective test takers pass the exam!

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It is a fundamental part of human nature to aspire to a future that is better than what we currently have. To the point that for those in even the most dire of situations, “hope” is what keeps us alive and going. After all, if there’s no hope that things could someday be better, there’s no reason to even bother trying to make it happen. Yet the reality is that hope alone is not enough to actually change our situation for the better. It’s hope, combined with action – and the sometimes scary moment of ‘taking the leap’ – that is necessary to lead us down a better path.

In this guest post, Stephanie Bogan of Limitless Adviser shares what it is that leads us to inaction and getting “stuck” – even and despite having an aspirational hope of making our advisory practices and our lives better – and why our ability to take the leap (or not) isn’t driven by figuring out the “right” methods and tactics to make the change, but changing our mindset and thinking differently about what’s possible in the first place.

So how do you find a path to better – or exponentially better hockey-stick-style growth – from where you are today. The starting point is to simply write down your revenue, income, hours worked every week, and time off per year. Then write down what you hope it could be if there were no constraints. And then double those goals… and reflect on all the negative thoughts that come to mind telling you it can’t be done, it won’t be possible, or that it’s too good to be true.

Because it’s only by facing our demons – those ‘limiting beliefs’ that we tell ourselves about what can’t be done, even though it clearly can because other advisors have – that we can get clear on what we’ve just been ‘tolerating’ (or outright avoiding), why we’ve gotten stuck in that pattern, and what steps we need to start taking if we really do want to achieve a different and better outcome instead.

Ultimately, the key point is to understand that what limits our success is not actually figuring out how to get to the next level, but the stories we tell ourselves – sometimes unwittingly or entirely subconsciously – that lead us to deny ourselves what’s actually possible. Of course, that doesn’t mean that the path of making a change won’t still entail challenges and a potentially significant amount of discomfort. But if the reality is that you’ve already allowed yourself to become “comfortably-uncomfortable” with your current level of under-success… why not at least redirect that discomfort towards your advantage?

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The financial services industry has long presented itself as one with high earning potential. As the saying goes, “there’s a lot of money in the money business”. For financial advisors, in particular, the career is often held out as one where advisors have ‘unlimited’ income potential… or at least, an earnings opportunity that is limited only by the hours of hustle that the advisor is willing to put in to build their book of clients.

Yet, while the average established financial advisor does earn significantly more than the median US household ($192,000 versus $68,700, respectively, according to the latest Kitces Research study), what’s even more notable is that when it comes to overall wellbeing, the average financial advisor actually outscores the typical American on all 18 subscales of the Comprehensive Inventory of Thriving! In other words, the career of being a financial advisor isn’t only one of above-average income, but it is rewarding across all domains of wellbeing, from relationships to engagement to mastery and meaning… with a particular focus on self-efficacy and accomplishment. In other words, the career of being a financial advisor is particularly conducive to those who are good at setting goals and being able to take action to achieve them… who then work with clients to help them set and achieve their own goals, too!

Unfortunately, though, one of the hardest aspects of being a financial advisor is simply figuring out what path to pursue to be a financial advisor, in an industry with choices from employee to independent, broker-dealer to RIA, large national firm to local boutique (or even just hanging one’s own shingle as a solo advisor!). For which it seems that every successful financial advisor says “their” channel and business model is the best… and in practice, relatively few advisors change channels at all throughout their careers!

However, as our 2020 Kitces Research study on Advisor Wellbeing reveals, not all advisor channels and business models are truly equal when it comes to advisor wellbeing. Instead, the reality is that the ‘best’ channel and business model for an advisor depends on their own intrinsic motivators and preferences. For instance, advisors who greatly value their autonomy may eschew the wirehouse model and pursue independence, while those who value income the most will tend to start their own firm (even though doing so is far more time-consuming), while those who value their time over just maximizing income may prefer an employee career path rather than trying to ‘eat-what-you-kill’ as an advisor who has to get their own client base.

In order to explore this further, we’re excited to announce our latest 2021 Kitces Research study on Advisor Wellbeing, specifically to delve more deeply into the intersection of what leads to the greatest levels of happiness and wellbeing as an advisor, and the motivators that lead us to become financial advisors (and to choose certain channels and business models over others). Notably, this year’s Wellbeing survey is shorter than our ‘typical’ Kitces Research study, and it’s our hope that every advisor will take a few minutes to share their own experiences and perspectives for this important research!

Thanks in advance for your participation and willingness to contribute!

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We’re all aspiring to grow into better advisors, with more clients, better niches, or bigger firms, but sometimes realizing that growth can be another challenge entirely. When we’re looking to grow, we may look to the most successful advisors, but feel that we can never truly emulate them due to a lack of time, networking, development know-how, or any other resources. In reality, those ultra-successful advisors have one secret weapon: mindset. Advisors who have a growth mindset, rather than a fixed one, are the ones most likely to see results!

Rather than having an exclusive growth mindset or fixed mindset, though, most of us tend to flex somewhere between a fixed and growth mindset. Whereas a fixed mindset tends to avoid challenges and criticism, ultimately plateauing more often than not, a growth mindset will embrace challenge and criticism, persisting through setbacks to reach increasingly higher levels of achievement. Therefore, in order to succeed, advisors can start by focusing on developing a growth mindset as an attainable goal, and cultivating the habits that sustain high performance in order to get there.

Importantly, high performance is not about grinding one’s way to success no matter the cost; instead, it’s more about sustainable success and achieving a lot without sacrificing too much. Accordingly, the key to high performance is in finding a balance between reaching goals and sustaining well-being and healthy relationships, which is supported by six primary attributes that are characteristic to help them efficiently overcome the roadblocks that come their way: clarity, energy, purpose, courage, and productivity.

To start, advisors can take a closer look at what may be holding them back. For example, many advisors fall into the ‘busyness’ trap, citing lack of time as their primary reason for not growing. Another common pitfall is a negative association with sales. Many advisors enjoy the art of financial planning and/or investment management and making a difference in others’ lives, but they shy away from the sales aspect. Lastly, and perhaps most critically, advisors can run into subconsciously limiting beliefs.

Each of these roadblocks is a common challenge faced by many advisors. To overcome these challenges, advisors can start by conducting a high-performance audit to help them identify their subconscious limiting beliefs (which we all have!) and assess their strengths. From there, a roadmap can be developed to bolster their most impactful key strengths and to develop weaknesses, one by one.

Ultimately, for financial advisors who have adopted a growth mindset, getting stuck is just part of the growth cycle. Getting past setbacks generally starts with self-understanding, having a clear purpose, developing a sustainable action plan, and committing to the courage and focus needed to implement the plan. The great news is that advisors who take the time to find and address their weaknesses, pivot, and create sustainable plans of action to resolve one weakness can reuse these principles again and again, to eventually reach their goals—and even to exceed them!

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As the vaccination count continues to rise and the new case count for the coronavirus continues to decline, more and more people – including financial advisors – are beginning to emerge from the shutdown and return to ‘life as normal’, which means a return to school, a return to the office… and now that summer is arriving, a return to the family trip and summer vacation. Which means some downtime for rest and relaxation. And for many, that includes finding some time to read and catch up on a few good books!

For those who love a good book, though (and especially for those who have limited time and will only get to read a few), the question quickly becomes “what’s a good book worth reading these days?” As a voracious reader myself, I'm always eager to hear suggestions from others of great books to read, whether it's something new that's just come out, or an "old classic" that I should go back and read (again or for the first time!). And so, in the spirit of sharing, a few years ago I launched my list of "Recommended (Book) Reading for Financial Advisors", and it was so well received that in 2013 I also started sharing my annual "Summer Reading List" for financial advisors of the best books I'd read in the preceding year. It quickly became a perennial favorite on Nerd's Eye View, and so I've updated it every year, with new lists of books in 2014, 2015, 2016, 2017, 2018, 2019, and a fresh round last year in 2020.

And now, I'm now excited to share my latest Summer Reading list of top books for financial advisors in 2021, including some suggestions from our growing ‘team of nerds’ here at Kitces.com, from a deep dive into how helping clients with their money psychology can impact their wealth more so than ‘just’ the technical financial planning advice, why it’s so important to create time and space for the “Deep Work” that adds the most value, what the financial advice business can learn from the restaurant hospitality business, why the long-term key to building a successful business is not about maximizing your own skills and productivity but in finding the “Whos” that can help turn your ideas into reality (and then how to get the most out of the people on your team), what it takes to be more relevant for prospective clients and how to get them to actually see your value as a financial planner (hint: stop telling them about the value of your financial planning advice, and just start giving them financial planning advice that they’ll only want more of!), and some great guidance on how to not just have more answers for clients but how to ask better questions (replete with a list of actual questions to try out with your clients!).

So as the summer season gets underway, and summer vacations return, I hope that you find this suggested summer reading list of books for financial planners to be helpful… and please do share your own suggestions in the comments at the end of the article about the best books you've read over the past year as well!

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As the total number of CFP certificants crosses 90,000 – nearly 1/3^rd of all financial advisors – and the number of undergraduate and graduate school CFP Board registered programs continues to grow, the pathway of a college degree plus CFP certification is increasingly becoming the way new financial planners learn how to do financial planning. Yet the reality is that while a theory-based education may provide the “book smarts” and an understanding of the regulatory and legal sides of the practice, it doesn’t necessarily give future financial advisors the full scope of understanding and skills needed to thrive as emerging professionals. While at the same time, ‘on-the-job’ training is still far too often focused on teaching the sales skills it takes to get new clients… but not necessarily what new financial planners need to learn to deliver good advice that clients will actually implement. Which means, simply put, that the emerging pathway for training new financial planners may not be providing the full base of knowledge and education really needed to be successful as a financial planner.

Fortunately, though, other established professions have long since determined an alternative approach to teaching and training new professionals to figure out how to actually apply their book knowledge in real-world situations: experiential learning. From veteran craftsmen to train apprentices, to experienced doctors who train residents, to simply getting an internship with an experienced professional, getting an opportunity to learn by “seeing how it’s done” in practice remains a remarkably effective way to learn. In the context of financial planners, in particular, this means shifting from a purely technical-focused training or one that only practices sales techniques to turn prospects into clients, into an experiential learning approach that allows for the practice of advice techniques to convince clients to actually implement the advisor’s advice.

However, experiential learning opportunities have been limited in practice. Conferences can be costly and take time to vet out which ones are genuinely applicable to people who have not truly entered the industry yet. Internships, while useful (at least when well implemented), are limited in number and often only provide the scope of how one particular firm does financial planning. And few firms have the depth of team or capability to implement a systematized apprenticeship-style training program for a large number of aspiring financial planners.

The good news is that the rise of the pandemic has driven such a newfound focus to online learning, that it is also creating new opportunities and best practices for experiential learning to go online as well. A case-in-point example is the FPA Externship, which launched in 2020 as an 8-week intensive online experiential learning program. Similar to an internship, the goal of the FPA Externship is to provide new financial planners an opportunity to get exposed to the real-world practice of financial planning. However, the virtual environment makes it possible to give participants exposure and experience to many different firms’ styles and strategies, while ensuring a rotation through all the different areas of financial planning (not just the one area that one particular firm is focused on). In other words, aspiring financial planners get to see a wide range of what it actually looks like to be a financial planner and do financial planning for various types of clients with varying needs delivered by experienced advisors with a wide range of planning styles.

The significance of programs like the FPA Externship is that the financial services industry is in the midst of a shift from sales-based “financial advisors” to advice-based financial planning, but new financial planners often can’t tell which jobs are which until it’s too late. Consequently, a break can emerge between what new advisors saw in education and what they witness in practice. Which in turn can lead to disillusionment and many talented financial planners leaving the profession… not because of lack of interest, but because they never get to see what the financial planning profession is truly capable of at its best.

Ultimately, the key point is that technical and sales training can take future advisors far, but without experiential learning to understand what the financial advice business is really about, new financial advisors will at best be under-trained when they first begin to work with clients, and at worst can face disillusionment as they begin their careers (and potentially leave the profession before they even really start!). Fortunately, though, programs like the FPA Externship – which is soon to close its summer 2021 enrollment! – are emerging that can fill this gap and provide advisors an understanding of the true power of financial planning, thus developing a stronger generation of financial advicers for years to come!

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Since 1991, the CFP Board has offered the CFP certification exam to establish a high standard of excellence for financial advisors to act as fiduciaries for their clients. The exam is a rigorous, 6-hour test, and is offered only three times a year. Because of the rigorous nature of the exam and the scope of material covered (not to mention the relatively low pass rate generally ranging from 60–65%), candidates aspiring for CFP certification invest an inordinate amount of time to ensure that they pass the exam. And to make sure that they structure the time devoted to test preparation most accurately, candidates need to consider several factors, including the requirements to take the CFP exam, their own learning styles and study habits, the resources available to them, and how to structure a schedule to follow to stay on track to best prepare for the exam.

The first important key for any CFP candidate to create a workable study plan for the CFP exam is to understand whether they are visual, auditory, or kinesthetic learners. By knowing their own learning style, candidates can implement the most useful CFP exam prep tools to help them retain and apply the information they will need to pass the exam. Understanding their learning style can also help candidates choose the right CFP exam review course to prepare for the test. While review programs can be expensive (generally ranging from $800 to $1,500), they have helped many candidates successfully prepare for (and pass!) the exam by conditioning them to the style and pacing of questions, helping them review material and create a framework to recall important facts, and providing general support and practice materials.

Candidates will find that creating a structured study schedule is critical for successfully preparing to take the exam. The general recommendation is to devote at least 10 hours per week, with a total of 150-250 hours (which means approximately 4-6 months of preparation), to study for the CFP exam. While most review courses guide candidates through creating a structured study plan, candidates should ensure that they actually stick to their plan of action and devote ample time to any areas they may be struggling with, being mindful to learn and understand the material – not just to memorize it – knowing how the breakdown of topics covered by the exam are weighted. Taking practice exams and working through as many practice questions as possible will help candidates get accustomed to the nature and scope of questions that will be on the exam.

During the final stage of exam preparation, candidates should focus on developing confidence in passing the exam, spending time reviewing the basics in each topic area, and getting plenty of rest to mentally prepare for exam day. On the day of the test, candidates should ensure they have their calculator (and a backup, if possible), a valid photo ID, and a packed lunch that can be kept in their car or on-site locker.

Ultimately, attaining CFP certification is no small task; the exam requires a great deal of commitment and requires candidates to build up enough confidence to actually decide – with conviction! – to pass the exam. While preparing for the exam requires hard work, focus, tenacity, and a lot of effort, the payoff is well worth the sacrifice. CFP professionals can confidently set themselves apart as competent and knowledgeable financial planners who can use their financial planning knowledge to positively impact their clients’ lives by helping them achieve their goals!

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The traditional role of a financial advisor is to provide financial planning services to their clients, or at least to support the financial planning process in an advisory firm. However, with the growing number of programs that provide the educational foundation required by the CFP Board for rising certificants to earn their CFP designations, there is an increasing demand for qualified teachers of financial planning. This growing opportunity has appealed to many advisors – not only has it offered new career options for financial planning professionals as an alternative to client-facing work, it can also be a unique marketing opportunity that increases the credibility of an advisor as a well-qualified financial planning expert in their work with clients, and gives firms an opportunity to see first-hand the top students in a local program that might be future hires (at least within the limits of what university conflicts-of-interest policies will allow for their instructors).

However, there are many different types of teaching roles that a financial advisor can consider. A position as a part-time instructor may make the most sense for advisors who want to continue serving financial planning clients. Compensation typically ranges from $3,000 to $7,000 per semester course, though part-time instructors at the undergraduate level are generally required to have earned a Master’s degree in a related field in order to get the paid teaching opportunity. For those who are interested, aside from the time commitment of actually teaching courses (which typically involves approximately 45 hours per semester per course), advisors should be aware of the time commitment involved in preparing for the course (for the first-time instructor, this can involve several hours per lecture given). Accordingly, given the relatively low salary range and high time commitment, financial advisors who choose to teach in these roles generally do so out of a love for teaching and as a way to give back to the industry by helping to prepare new advisors.

Full-Time instructors, on the other hand, tend to have a regular assignment of courses with some certainty of when and which subjects will be offered throughout the year. The job security of a full-time instructor is much more stable than that of a part-time instructor and, for non-tenure track positions (i.e., less permanent appointments with little or no research commitments), annual compensation levels generally start in the $50,000 to $80,000 range. However, full-time positions will make it more difficult for an advisor to continue working outside the classroom (though it may still be possible); thus, advisors will typically need to be willing to give up work in their financial planning practices, and should be prepared for an academic career (and academic compensation levels). In addition, advisors again will generally be required to have earned a Master’s degree and have some relevant professional experience for a full-time instructor role.

Individuals interested in pursuing tenure-track professor roles will find opportunities at research and/or teaching universities with financial planning PhD programs (and occasionally PhD programs in other fields, such as Family and Consumer Sciences), though the requirements to qualify for an appointment are much more stringent than for other types of teaching roles. New “assistant professors” can expect starting salaries to range widely from $60,000 to $130,000. While maintaining a financial planning practice may be very difficult for a tenure-track professor because of the work involved in both teaching and research, advisors can find ways to stay connected to their firm, potentially through occasional ad hoc planning work, relying on other firm partners, or by outsourcing work to others.

For those in a tenure-track position, earning tenure involves a long process unto itself, but their positions become very secure as tenured faculty positions are permanent, lifetime appointments (where it’s very difficult to get fired short of very substantive failures to do the core job). However, research universities will generally require a significant amount of research to be done by their faculty in a tenured professor role. For example, some popular CFP Board Registered PhD programs expect their faculty to publish an annual average of three articles in peer-reviewed academic journals every year, though the actual expectation varies greatly and can be gauged by determining what tenured professors published during their own probationary (tenure-track) period. In addition to research requirements, some institutions (e.g., those that are accredited by the Accreditation Council for Business Schools and Programs, or ACBSP) require individuals to have 15 finance graduate credits in order to teach in their programs, though other institutions (accredited by the Association to Advance Collegiate Schools of Businesses, or AACSB) don’t necessarily share this 15-credit requirement, but may have their own standards (which vary by institution, and could still include a 15-credit requirement) that define requirements for teaching eligibility.

Ultimately, the key point is that there are many financial planning teaching opportunities, some of which have relatively low education and experience requirements that can be managed by a financial advisor without having to give up their practice of financial planning itself. On the other hand, for those who actually wish to pursue a financial-planning-based career in academia on a full-time basis, there are also growing opportunities for full-time instructors and even tenure-track faculty positions at a research university. Regardless of the role, though, teaching opportunities in the financial planning field can serve as a great way for advisors to enhance their current job roles (or even switch careers altogether!) and to contribute to the profession by supporting the education of aspiring financial planners!

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In a ‘normal’ year, summer is the season of vacation and family trips, as client meetings tend to slow down (if only due to the clients' own vacations), and advisors get a little more time for rest and relaxation. Unfortunately, the coronavirus pandemic has disrupted a lot of family and vacation plans for 2020… yet the need for getting some rest remains, as it is arguably even more important to find time to recuperate from the client and business stresses of recent months. Which in practice, often includes finding a little time to catch up on some good books!

The question, of course, is then to figure out “what’s a good book to read these days?” As a voracious reader myself, I'm always eager to hear suggestions from others of great books to read, whether it's something new that's just come out, or an "old classic" that I should go back and read (again or for the first time!). And so, in the spirit of sharing, a few years ago I launched my list of "Recommended (Book) Reading for Financial Advisors", and it was so well received that in 2013 I also started sharing my annual "Summer Reading List" for financial advisors of the best books I'd read in the preceding year. It quickly became a perennial favorite on Nerd's Eye View, and so I've updated it every year, with new lists of books in 2014, 2015, 2016, 2017, 2018, and a fresh round last year in 2019.

And now, I'm now excited to share my latest Summer Reading list of top books for financial advisors in 2020, including some suggestions from our growing ‘team of nerds’ here at Kitces.com (including Derek Tharp, Erica Crane, and Matt Nelson), with suggestions on books about building a virtual culture (if you decide to keep your advisory firm virtual even after businesses are permitted to re-open in person!) or alternatively hiring a virtual assistant, how to refine and focus your marketing message by figuring out exactly what your value is to clients (in essence, what ‘job’ your clients are really hiring you to fulfill) and how to more effectively differentiate (under the philosophy that for branding purposes, “it’s better to be different than [just] better”), tips on how to better communicate with clients and help them change their behaviors to achieve their own goals, ways to take small steps to improve your own life (and why it’s easier to improve yourself by taking small steps instead of making big change resolutions), a discussion of whether we’re focusing on the wrong measures of economic growth and wealth in setting economic policy, and a look at how various government policies over the past 200 years have limited the ability of many minority populations to be able to accumulate wealth in the first place (which, due to two centuries of compounding – or the lack thereof – have amplified the racial wealth gap in America, with profound implications on the diversity of financial planners and who we serve as well).

So as the summer season gets underway, I hope that you find this suggested summer reading list of books for financial planners to be helpful… and please do share your own suggestions in the comments at the end of the article about the best books you've read over the past year as well!

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