What is a CFP® and Why It Matters for Emerging Planners

Contributed by: Iris Hayes

Edited by: Kelsey Arvai, CFP®, MBA

The Emerging Wealth Series 

Iris Hayes and Josh Golden join The Center for the summer. This series is a summer intern-led exploration of the values, behaviors, and trends shaping the future of wealth. 

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In this digital age, it is easy to get swept up by the information at our fingertips, drifting down an endless stream of posts, news headlines, and updates. Non-credible sources spin misleading stories online, competing for attention and reactions, and capitalizing on viewer fear. Alarming headlines and captions cause people to panic and sell investments. These news sources do not have your best interests at heart. That is why guidance from reputable and experienced professionals is so vital. CFP® (CERTIFIED FINANCIAL PLANNER®) practitioners are professionals who meet rigorous education, training, and ethical standards—completing extensive training and gaining experience while committing to the CFP Board's ethical standards, which require putting their clients' interests first. Candidates must satisfy four 'Es' that are key components to the CFP® Certification process: education, exam, experience, and ethics, to prove their eligibility for the certification.

Education—complete coursework through a CFP Board registered program and hold a bachelor's degree in any discipline from an accredited college or university.

Exam—pass an exam of 170 multiple-choice questions. The questions are based on financial planning scenarios, case studies, or simply stand-alone problems. The exam is held in one day in two three-hour increments.

Experience—have at least 6,000 professional hours or 4,000 apprenticeship hours in the financial planning industry.

Ethics—sign a document of ethics set by the CFP Board and pass a background check.

Interest in pursuing this credential is growing, with a particular emphasis on younger demographics. Factors such as economic uncertainty, technology, and the demand for personalization are among the key drivers that keep the financial planning industry thriving. Combined with the Great Wealth Transfer underway, it is an opportune time for the next generation of financial advisors to enter their careers. 

Young professionals in the field should consider how becoming a CFP® Professional can elevate their careers. Kali Hassinger, CFP®, CSRIC®, is a Senior Financial Planner and CERTIFIED FINANCIAL PLANNER® professional at Center for Financial Planning, Inc.®. Kali expresses the benefits of what she calls a consolidated education, "highlighting important knowledge you will need going into your career." The structured learning approach ensures that aspiring financial planners develop strong foundational expertise.

My desire to get the certification stems from seeing its value in the workplace. It enables planners to demonstrate their credibility and establish trust with their clients. Earning your CFP® marks is no walk in the park, so it demonstrates that you are committed to providing ethical financial planning services to your clients, and they truly value that. The designation is becoming increasingly prevalent. While it remains a differentiator among financial advisors, it is quickly becoming a standard for excellence.

I am currently one of two financial planning interns at the Center for Financial Planning, Inc. in Southfield, Michigan. Our firm is currently celebrating its 40th anniversary. Across 35 team members, 15 of us hold the CFP® marks*. From my perspective, as a student completing CFP Board-approved coursework at Michigan State University while pursuing my bachelor's degree in economics with minors in Financial Planning & Wealth Management and Financial Literacy, I am delighted at the opportunity to be able take advantage of interning at an office with experienced professionals to further my understanding and knowledge beyond just passing the CFP® Exam. Here is what I have found helpful and would like to share with other aspiring financial planners:

The timing at which you take the exam is important. It might be best to knock the exam out right after graduation, while you have a studious mindset, and before your career fully begins. If this option appeals to you, there are two ways to go about it. From what I've learned, you can either register for the July or November exam. A July date would require you to put in long study hours as your classes wind down in the spring and into the summer. November would allow you to ease into a study routine. Both options have their benefits and drawbacks; the best choice really depends on your preferences and circumstances.

Depending on your unique situation, you may want to consider taking an exam like the Securities Industry Exam (SIE) to warm you up for the CFP® exam. This could help you build your resume, gain expertise, and give you a trial of what a study routine might look like for you. The SIE exam is a prerequisite introductory-level exam for aspiring financial professionals looking to enter the securities industry.  

Research the program that will be best for you. Invest in a reputable program and study materials, such as those offered by Dalton Education, LLC, or Zahn Live Review Exam Prep. Look for crash course opportunities to learn how to better strategize for studying and taking the exam. See if you can get sponsorship, employers appreciate motivated team members and may be willing to help fund your journey.

Recognize that it is a significant time commitment and develop a study schedule to strictly adhere to. Account for special events that fall within your study schedule to work around them and avoid unnecessary stress. The psychological aspect of this exam is often overlooked. Prioritizing "resets" during your study period, whether that be sleep or an activity you love, is a great way to ensure you are refreshed and ready to retain information.

No matter where you stand—whether you are a client, a student, or someone who is considering a change in their career, the CFP® mark holds immense value. Understanding its benefits can open doors to a rewarding career, financial well-being, and valuable connections within the financial services industry.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of the author and not necessarily those of Raymond James.

Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Center for Financial Planning, Inc. Center for Financial Planning, Inc.® is not a registered broker/dealer and is independent of Raymond James Financial Services.

Any opinions are those of the author and not necessarily those of Raymond James. All opinions are as of this date and are subject to change without notice. The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Investing involves risk and you may incur a profit or loss regardless of strategy selected.

Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®, and CFP® (with plaque design) in the U.S., which it authorizes use of by individuals who successfully complete CFP Board's initial and ongoing certification requirements.

*CFP holders include Lauren Adams, CFA®, CFP®, Sandra D. Adams, CFP®, Kelsey Arvai, MBA, CFP®, Josh Bitel, CFP®, Michael Brocavich, CFP®, MBA, Nick Defenthaler, CFP®, RICP®, Logan Dimitrie, CFP®, Kali Hassinger, CFP®, CSRIC®, Robert Ingram, CFP®, Matt Trujillo, CFP®, Tm Wyman, CFP®, JD, Nicholas Boguth, CFA®, CFP®, Angela Palacios, CFP®, AIF®, Jeanette LoPiccolo, CFP®, and Andrew O’Laughlin, MBA, CFP®.

How TikTok is Shaping the Next Generation of Investors

Contributed by: Josh Golden

Edited by: Kelsey Arvai, CFP®, MBA

The Emerging Wealth Series 

Iris Hayes and Josh Golden join The Center for the summer. This series is a summer intern-led exploration of the values, behaviors, and trends shaping the future of wealth. 

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There is nothing that winds me down better than scrolling through my TikTok for you page (FYP) in my free time. Watching updates on pop culture, compiling athlete highlights, and discovering new artists are some of my favorite videos to watch. What started as a lighthearted entertainment app is now a prominent financial education resource for investment strategies, budgeting, and personal finance. TikTok's greatest strength lies in the appeal of short-form video. The ability to access knowledge so readily from these videos draws in a large number of viewers on financial TikTok (FinTok).

In personal financial education, these creators do a fantastic job of taking complicated financial information, simplifying it, and presenting it in an entertaining way. Therefore, it makes it so everyone can learn about how finance works and how it will affect their life.

For investment strategy focused videos, creators produce videos on what characteristics to look for when creating an investment portfolio. These videos make it easier for younger viewers to understand different investment tools, such as stocks, bonds, and ETFs. With a variety of "FinTok" videos readily available, TikTok is shaping the minds and habits of the new generation. TikTok is revolutionizing how the new generation learns about important financial topics.  

Misinformation spreads like wildfire, especially through TikTok. When exploring FinTok, it is necessary to be aware of whose advice you trust. Anyone can seem like an expert. A simple way to verify credibility is to look them up on LinkedIn or any financial institution website. Utilize resources like FINRA's BrokerCheck or the SEC's Investment Adviser Public Disclosure (IAPD) database to research employment history, qualifications, etc.

Additionally, misinformation spreads by creators promoting their speculations. This is a potential danger for young professionals because these investments shown in the videos are highly volatile. These creators often advertise their investments with the intention of leveraging their influence to encourage their audience to invest, which in turn causes the creators' initial investment to increase in value. The creator then sells their shares and tanks the investment. What can we learn from this? Do not follow investment advice from someone who is not licensed or has something to gain from you investing in the same investment as they do. The combination of FinTok's insights and professional guidance can provide a solid foundation of knowledge for young professionals. The sky's the limit for learning, but you need to be aware of whose resources you are learning from.

Once a niche on TikTok, FinTok has emerged as one of the most relevant financial resources for the new generation, given its accessibility. Financial professionals are creating content to answer the basic money-related questions that most people hire others to answer. Professionals in economics and finance create simplified videos based on trending topics. Many young viewers rely on these videos more than an article by a news company. The reason for this is simple: entertaining and easily digestible videos are a more realistic way for the new generation to comprehend complex and critical information quickly. What's great about TikTok is its algorithm. Based on users' searches and watch history, it generates your FYP based on those searches. So, if you look up a video on stocks, your FYP will show more videos on stocks and other information correlated to stocks. Ultimately, the short and engaging style of videos makes the intricate financial information easier to retain.

While recognizing that TikTok does not replace the need to read from credible news sources and engage with professionally published content, TikTok offers a gateway to more opportunities for beginners. Across these videos, the creators make investing seem less intimidating by defining the characteristics that people often worry about when investing. For some, hearing creators share their personal journeys and thought processes helps shift their mindset from fear to opportunity. Beyond investing, trends and viral challenges shape how young professionals think. The term "girl math" was coined to poke fun at obscure logic to rationalize spending habits. Although this trend may seem silly, it has a deeper meaning. Girl math reveals realistic and entertaining views on the psychology of spending. Ultimately, trends like these help people become more comfortable talking about their finances.  

All in all, TikTok has an immediate impact on the next generation of investors and young professionals. The most significant benefit of FinTok is its extensive range of simplified financial explanations, presented in a concise video format. Looking into the risks of FinTok, it is important to be aware of whose content you trust. Young professionals should engage with professionals in the financial industry, not random market speculators. FinTok continues to evolve as a reliable resource for young professionals to learn about the complexities of the financial world. Could TikTok be a major networking tool for finance? Only time will tell.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of the author and not necessarily those of Raymond James.

Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Center for Financial Planning, Inc. Center for Financial Planning, Inc.® is not a registered broker/dealer and is independent of Raymond James Financial Services.

The Financial Starter Kit: Budgeting, Credit, and Investing for Young Professionals

Contributed by: Josh Golden

Edited by: Kelsey Arvai, CFP®, MBA

The Emerging Wealth Series 

Iris Hayes and Josh Golden join The Center for the summer. This series is a summer intern-led exploration of the values, behaviors, and trends shaping the future of wealth. 

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As a young professional (YP) emerging in the financial planning industry, this topic is top of mind for many, including myself and my peers. By being aware of your current finances, YPs have a tremendous opportunity to start investing in their future. It’s as simple as creating a budget for all sources of income and expenses. By acting early, you can build healthy money habits starting with an emergency fund (typically 3 to 6 months of liquid cash on hand). Before you can think about putting money aside to fund your financial future with investment vehicles, such as a Roth IRA, you first need to figure out your budget. Proper budgeting, forward-thinking, and starting to plan for retirement are all the main aspects that YPs should be thinking about.

When thinking of financial stability, a budget is the most efficient way to identify your sources of cash flow, money coming in, and money going out. This is crucial because the plan helps you accurately interpret your finances, enabling you to spend within your means. A trusted model to base your budget on is the 50/30/20 rule. This model is based on your total gross income. Ideally, 50% of the income would be earmarked for life expenses, 30% for lifestyle expenses, and 20% for savings (short-term and intermediate) and investments (intermediate and long-term). One thing that has worked wonders for me is thinking about the opportunity cost of the things I want to purchase. This means that I might ask myself, would I be better off in the long run with a new pair of jeans or $60 earning interest in my savings account? You could go further and equate $60 to three hours of work (assuming you make $19/hour). This puts into perspective the importance of intentional spending and weighing your options before buying those new pair of Abercrombie & Fitch Jeans.

Another important topic to discuss is credit. Credit is the ability to pay for things without having the money immediately and with the promise of repayment in the future. Credit scores are used by landlords, employers, and loan companies to assess your credit health. Therefore, it is essential that you systematically monitor your score to optimize your opportunities. The primary consideration when managing credit cards and credit scores is making timely payments, maintaining a zero balance, and keeping your spending at or below 30% of your credit limit. Keeping all of these in mind is what can trouble people the most. This goes with what has been discussed so far in the importance of creating a budget. That plan will ensure everything in your financial life goes as smoothly as possible. A great way to maintain a good credit score is to use less of your available credit limit. A good rule of thumb is 30% or less of your total credit limit. In an ideal world, you carry a $0 balance and completely pay off your card each month. By doing this, you never run the risk of spending more than you can afford. Another strategy for credit building is putting your gas and phone bills on your credit card. This system helps build positive saving behavior, a good payment history, and a good credit record.

For young investors, I believe a Brokerage Account, Roth IRA, or IRA is a great place to start your investment journey. Before doing so, it’s important to establish emergency savings. Emergency savings are often overlooked due to the pressure to keep up with the narrative that investing early, and often, is the most important. Yes, this is true, but there is a balance between taking care of your current self and future self.

The younger you expose yourself to the market, the higher the investments will compound and help you fund your current needs, future goals, and overall financial independence (retirement). Think of investing like planting a tree; you start with a seed, which represents your initial investment, and you monitor it over time and see how it grows. The growth over time from the tree is like your investments compounding. I feel it is best to be exposed in the market as early as possible because it is all about your time in the market, not timing the market. Better returns, consistency, and less worry are all factors of long-term investing. When comparing this to short-term speculation, you deal with heavy fee and tax ramifications as well as the highest form of volatility. The “get rich quick” mentality is flawed and often results in investors being burned by trying to time the market perfectly. Results and studies prove that investing for the long term is the most effective way to let your money work for you.  

Overall, YPs have a lot to think about when it comes to their financial future. Allocating current expenses, building prominent credit, and starting to save for retirement. By spending time on each of these aspects, they will have a healthy financial future. Your future self will thank you for starting your investment journey now because making informed decisions that consider both your current and future needs helps you live your dream life, not just in retirement. Think of yourself when you turn 70 years old; what do you want to think back on when you look back on your life? You have the chance now to set your future self up for success; what are you waiting for?

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of the author and not necessarily those of Raymond James.

Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Center for Financial Planning, Inc. Center for Financial Planning, Inc.® is not a registered broker/dealer and is independent of Raymond James Financial Services.

Why Your Money Story Matters: Connecting Childhood, Identity, and Financial Goals

Contributed by: Iris Hayes

Edited by: Kelsey Arvai, CFP®, MBA

The Emerging Wealth Series

Iris Hayes and Josh Golden join The Center for the summer. This series is a summer intern-led exploration of the values, behaviors, and trends shaping the future of wealth.

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Think back to your earliest memories of money. Were you the kind of child who let your piggy bank grow heavy, or did you tend to unplug it at the melody of the ice cream truck? How did you go about spending money gifted from birthdays? Holidays? Early behaviors such as these laid the foundation for how you spend your money now. Recounting these experiences is important, because they give you a better understanding of your relationship with money. By challenging yourself to find patterns in the past, you will be able to make emotionally intelligent decisions with your money in the future.

Defining Your Story

What is my money story? A money story is a collection of memories, experiences, traumas, and events that shape the connection you feel toward money. It is generational, going back to the relationship your parents and their parents had with money. You may remember coming home to your dad sitting at the kitchen table. Head in hand, leaning over a pile of unpaid bills. Perhaps your mom stood by his side consoling him, "It'll be okay'" or maybe it caused tension in their marriage. In the household next door, funds were abundant but also hushed, never equipping your friend with the financial skills they need now.

These different upbringings influence the way individuals perceive their self-worth and their place in society. Those who grew up facing financial hardship had an awareness that success won't come easily. Whereas children brought up in wealth might take privilege for granted and be overconfident to a fault. Personally, coming from a very average working-class family, I recall blowing my allowance on $20 Lululemon headbands to establish status in middle school. These splurges would continue into high school and college, allowing me to keep up with my friends. As silly as it might seem, the things we do with money have a significant impact on our identity and how we wish to be perceived.

Whatever your money story is… whatever promises you made to yourself about how you will handle money as an adult, all have an influence on your financial wellness.

Re-Framing

Take, for instance, the 2008 recession—many struggled with the economic impact on their retirement accounts. This experience may have altered their view of money and sense of safety, leading to changes in their behaviors with money (such as keeping more cash than necessary). This exemplifies the connection between money-related stress and our habits.

The goal is not to completely avoid stress or hardship; the goal is to have a plan in place to help ease your mind during times of uncertainty. Let's face it: life is full of uncertainty. We do not know what will happen, but what we can do is plan for the worst-case scenario. This doesn't disregard your wants and needs but rather recognizes unfavorable reactions you might have towards money. These reactions can look and feel intense, feelings such as fear, anxiety, and guilt. By proactively planning and identifying these reactions, you can maintain your financial trajectory. Life will feel easier when you can refer to your plan to help guide you, even considering unforeseen economic and financial hardships.

Circling back to the Lululemon headbands, I've found that I've grown to reach greater satisfaction by building my savings to spend on experiences rather than spending frivolously on retail. I still enjoy shopping; however, now, I do it more consciously. I suggest buying with intention. For me, that looks like a mix of new, high-quality basics and filling out the rest of my wardrobe with fun pieces from second-hand or vintage stores. That is what works for me and my budget.

Take a moment to set financial goals and evaluate how they align with your spending habits. Is online shopping for a quick boost of serotonin getting in the way of saving for something that will bring more happiness in the long run? Do you feel yourself caving into excessive spending that leaves you in shambles come Sunday morning (AKA Sunday Scaries)?

The time that you put aside to set value for these spending habits and their relation to your end goals will be vital for your success. Pairing these strategies with professional guidance can make the transition from reactive spending to intentional financial planning even more impactful.

What are some financial habits you want to rework? We would love to hear from you! Reach out to us at CFPIntern@CenterFinPlan.com or call us at (248)-948-7900.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of the author and not necessarily those of Raymond James.

Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Center for Financial Planning, Inc. Center for Financial Planning, Inc.® is not a registered broker/dealer and is independent of Raymond James Financial Services.