I just signed up for the CFP Course at NYU, and wanted to share some thoughts on the decision making process and the strategies I will be following in order to do this in the most efficient and value orientated way.
The Certificate in Financial Planning (CFP) is considered to be the Gold Standard in Financial Planning, and is overseen by the CFP Board. They offer the exam for this 3 times per year with a pass rate that hovers around 60% (lower for repeat takers). Certain people are allowed to fast track to the exam by sitting just one course, known as the Capstone Course which is only 8x 3hr sessions, the people allowed to take this fast track are known as Challenge Students and must meet one of the following criteria:
- Ph.D. in business or economics*
- Doctor of Business Administration*
- Licensed attorney – inactive license acceptable**
- Licensed Certified Public Accountant (CPA) – inactive license acceptable**
- Chartered Financial Consultant (ChFC)
- Chartered Life Underwriter (CLU)
- Chartered Financial Analyst (CFA®)
- CFP certification from the Financial Planning Standards Board Ltd. (FPSB) Affiliate located in your territory of residence outside the U.S.
Unfortunately I don’t meet any of these criteria and as such I must sit through a 8 section course provided by an approved institution. I checked into several course options, and found the lowest for around $3,200 from Bryant Stratton College (online delivered) and at time of writing this found another offering from Boston University for $1995 or $2895 depending on your pacing.
Strangely as it might seem, I opted for a more expensive option at NYU costing around $5,850, and whilst it may seem odd to pay more for something there are a few reasons behind my decision:
Classroom format rather than online. This allows for networking opportunities with other students, teachers and access to companies interest in hiring from NYU through their careers program.
Prestige. This is something that I think is silly, but as much as might disagree with the notion people do care where you studied, and NYU has more clout than an online course from a lesser known school. I do think this is unfair because at the end everyone is sitting exactly the same exam which is administered by the CFP Board. Though in its defense there might be more rounded approaches to subjects that you get from working with world class teachers.
Acceleration of course. I’m a grown man, I don’t want to spend time in college to get in touch with my inner student, I want certification as quickly as humanly possible. In fact I am quite upset that I cannot sit for the exam without the course, if it is a comprehensive and well developed exam then it should be able to easily weed me out if I don’t have the required knowledge. The course with NYU isn’t perfect for acceleration, but it is the best I could find, here are the current subjects on offer (which are the same in each institution):
As you can see they have favored Monday for classes, so due to that overlap I cannot complete the course in 2 semesters, but I can complete it in 3, which is 33% faster than the fastest course offered by Boston University above. And even more advantageous than the Bryant Stratton course that wouldn’t allow any double subjects at all, making it a 14 month slog.
So, from a price perspective I opted to pay what will amount to 2-3x more for the course than I could have, but for me the price paid is not a pure ‘cheapest’ play, it is best value. Further perks include: the ability with NYU to pay course by course, meaning that I can pay for 3x courses at $800 each in year 1, and pay for the 4x courses at $800 in year two, making both years education expense under the $4,000 Tuition Deduction and as such allowing me to deduct the full $5,600 (there are some other minor courses that add onto this to make it $5,850) for those courses, with enough allowance on each year to also purchase supportive materials if needed.
Thoughts on Text Books
I haven’t confirmed this yet, but I doubt anything comes bundled in the NYU price so I am going to need to fork out additional money for text books. I have long felt that this is one of the greatest scams in the already highly scammed Education Business. A new text book each year adding a paragraph or two in strategic places means when the Professor states: “Open your book to page 32…” you will have to find out where that is in an older version if you aren’t consistently buying the latest edition.
One of the books that I think may form part of the course (I haven’t received a reading list yet) will be Personal Financial Planning: Theory and Practice (Dalton pfp series) which currently costs $93 from Barnes and Noble. To buy new, but there are many other options:
Buy Used ($69.75), Rent (60 days – $18.43, 90 days – $19.98, 120 days $22.20 , Buy Used from Elsewhere $2.74
Personally I have two choices here from the options above: I either buy NEW for $93 then attempt to keep the book in good shape until I want to sell it Used for $69.75. After fees and shipping that would probably be reduced to $55 for a holding cost of $38. The benefit of doing this rather than renting the book would be that I would be able to keep it as long as I wanted and use it for reference material prior to the exam, which will be at minimum 9 months from purchase date (likely longer due to there only being 3 exams per year offered by the CFP Board).
Renting here makes less sense because I would need to renew, and take it for 120 days plus another 90 or 120 day period (lets say 120 to be safe), for a holding cost of $44.40. For that price I would rather hold onto the book new and sell it when done. This is due to the type of course I am sitting though, as I cannot sit the final exam until all courses are finished and the final exam will reference work in course #1. In a Under Grad or Grad Credited Course I may not want to hold this long and renting would be better.
Of course, the obvious option is to reduce that holding cost from $40 to $2.74 by buying the ‘Used from Elsewhere’ these books are going to have some issues with them in that they are going to have some text highlighted already, which will likely annoy me, as I like to study in my own way and I may find myself distracted by the notes. In the past though, I picked up a copy of Dante’s Inferno that had some of the most fabulous notes penciled into it, so if you are lucky to have the prior owner be switched on, this could be a benefit, but if they happen to be one of the 40% of people who failed the course you might be led up the garden path…
My decision – Buy the super cheap used versions of the books. In truth as we can see from above in the big picture I would only save about 7X$37 over the course by doing this, so it is more a case of knowing what my habits are, and since I will be training in the gym daily I think these books will take some knocking about, which might prove a problem for returning the rentals or getting proper resale value.
What about the tax laws I hear you scream! Well, that’s the fear factor that motivates the purchase of the latest texts, that they will be teaching you in accurate data. However we are living in the digital age, and for any tables that I don’t already know by heart I can reference on the IRS website or other Finance and Law websites. I personally wouldn’t trust changing laws in any of the books I read because even the latest editions will become obsolete when legislation changes. It is concepts that we are using these books for, and supportive ones to the classroom instruction.
The beauty of picking the cheapest option here is that if I am way off base with this choice I can buy the latest version of the book and have it in my hands before the next class, and I would have only lost $2.74 by having made one bad decision and holding two books, it is a cheap, and easily reversible mistake if it proves to be one.
What do you think? Would have gone for the cheaper option, or pay the premium for the name, classroom networking and chance to finish the course in record time?