'You get all these altruistic benefits and the financial benefits,' says CFP Board chair Matthew Boersen
A typical certified financial planner likely will tell you she’s not primarily doing her job for the money, but holding the CFP designation helps ensure she’s compensated pretty well, according to a new survey by the organization that sponsors the mark.
Providing holistic financial plans that will improve clients’ lives is usually the main selling point when the Certified Financial Planner Board of Standards Inc. touts working as a CFP. The CFP Board released a first-ever survey of financial planners’ pay Thursday that shows the money’s pretty good, too.
The median total compensation for a financial planner – which includes salary, variable pay, company profits and profit sharing – was $198,500 in 2022, and that pay was 12 percent higher if the planner had the CFP credential, according to the study. Annual compensation for CFPs grew by 7 percent to 9 percent each year from 2019 through 2022.
The more experience CFPs have, the more they’re paid, the survey shows. CFPs who have been on the job less than five years have a median total compensation of $100,000, while those with more than 20 years are at $250,000.
If a CFP supervises staff members, pay increases. The median total compensation for a CFP who did not manage staff was $145,000. If a CFP managed six or more staff, the certificant earned $385,000.
The survey also found that CFPs are happy with the careers they’ve chosen, with 84% experiencing a “high to very high sense of personal fulfillment,” the CFP Board said in statement. Strong majorities of survey respondents rated as good or excellent such job factors as stability, work/life balance, compensation and career advancement.
The study was conducted by Industry Insights on behalf of the CFP Board. The survey of financial advisors across the country generated 980 responses with a margin of error of 3%.
The CFP Board, which sets and enforces the educational and ethical standards of the mark, will use the survey to try to convince high school and college students as well as career changers to purse a career in financial planning. The study will tell them what to expect, said Matthew Boersen, CFP Board chair.
“Here’s what coming into financial planning means,” Boersen, managing partner for Straight Path Wealth Management, told reporters Wednesday night. “You get all these altruistic benefits and the financial benefits. We now have data to back that [and] a really robust study that just gives much more power to some of the stories that we’re trying to tell.”
The CFP Board was able to sponsor the survey through an arm of the organization that was created last year that allows it to promote the business interests of CFPs. Prior to the CFP Board’s reorganization, its tax status only permitted activities related to the public interest.
Now it has more flexibility to sell a CFP as a crucial part of a financial advisors’ career trajectory.
“The underlying narrative is always that it’s all about making a difference and having a meaning – and those things come through in the research that we’ve done,” CFP Board CEO Kevin Keller told reporters. “But up there for parents and for students is remuneration.”
Parents pay close attention to potential pay related to their children’s career choices, and they can influence those decisions.
“Parents play a bigger role than their children will admit and not as much as [parents] think they do,” Keller said.
Boersen added: “And to bring it full circle, parents are influenced by the remuneration piece.”
The CFP Board announced last month that CFPs in the United States totaled 98,500 last year, a new record.
