Financial advisors who earn their CFP certification are earning 12% more than their peers, according to a new CFP Board study released Thursday.

That advantage translated into a median of $23,820 in more annual compensation for CFPs in 2022, the study said. As a result, the median total compensation for CFPs was $222,320, while non-CFPs earned $198,500, according to the CFP Board 2023 Compensation Study. The professional certification body defines total compensation as annual base pay, variable pay, company profits and profit sharing.

“The findings underscore the benefits of earning CFP certification and a career in financial planning,” CFP Board CEO Kevin R. Keller said in a statement.

Asked why he thought certificate holders earn more, Keller said in an email,  “CFP professionals are specifically trained to provide holistic financial planning to clients…so they help people achieve their dreams."

CFP professionals “also commit to CFP Board to act as a fiduciary—that is, to act in the best interests of the client. As more firms adopt holistic financial advice as a core service, the competence, ethics and professionalism that CFP® certification represents are increasingly in demand,” Keller added. 

Experience and years working in the field of planning and financial advice play a crucial role in determining compensation, according to the study.

CFPs with less than five years of work experience earned a median 2022 total compensation of $100,000. Those with five to 10 years of work experience earned a median total compensation of $152,000, while those on the job for 11 to 20 years earned $206,000.

CFP professionals with more than 20 years of planning experience earned a 2022 median income of $250,000, the board found.

CFPs with managerial and supervisory responsibilities also sweetened their total compensation. “For financial planners supervising staff, compensation scales up significantly. Those who supervise six or more staff reported a median total compensation of $385,000 in 2022,” the CFP Board said.

Planners with a CFP certification experienced “steady growth” in annual compensation over the past three years, with a 7% to 9% increase each year from 2019 through 2022, the study found.

The certification body found that “virtually all CFP professionals’ compensation packages include quality retirement benefits that provide a foundation for financial security when they retire.”

First « 1 2 » Next