CFFP #05 - Inside the CFP Exam and What You Need to Pass ft. Gary O. Clement

Conversations for Financial Professionals

Welcome to another episode of the Conversations for Financial Professionals podcast where we are shaping the next generation of financial advice.

Today we have Gary Clement. Gary is President of Clement Asset Management, LLC, a financial planning and investment management firm, a lead instructor in the Kaplan Schweser Certified Financial Planning Program, an adjunct professor at the College for Financial Planning, and an assistant professor at the University of Alabama. Gary also holds several professional designations and multiple educational degrees.

Today we discuss: what it means to be a Certified Financial Planner™; the difference that this certification can make in the eyes of the public; where Gary see’s the profession headed; as well as, some techniques of how to pass the exam (i.e. what to focus on!)

Show Highlights

• Gary’s POV on the obstacles and opportunities of 2020. (03:00)

• What it takes to have the title “financial advisor” and why there are currently less than 90,000 individuals holding the Certified Financial Planner™ designation versus more than 350,000 individuals identifying themselves as “financial advisors”. (05:19)
• Gary speaks on why he feels the profession will move toward “behavioral finance” as a matter of priority instead of happenstance. (09:08)
• Why individuals with no financial background have an advantage earning the Certified Financial Planner™ designation. (22:10)
• Gary shares his thoughts on the two main reasons people do not pass the Certified Financial Planner™ exam on the first try. (24:29

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Conversation Transcript:

00:00:00
Dominique
Hey there. Welcome to conversations for financial purposes!

00:00:04
Dominique
A podcast to help shape the next generation of financial advice. I'm your host Dominique Henderson today we'll be talking with friend and colleague Gary Clement, who is not only on the practitioner side as president of Clement asset management, but has spent many years in academia, teaching CFP candidates, the actual education and the tools that it's going to take to pass this exam. He has done a stint of academia at many institutions, including Kaplan certified financial planning program, the college for financial planning. Most recently the University of Alabama in today's conversation, we will be handling the topic of what it takes to actually pass this rigor of the CFP exam. We're going to be taking you inside with some of the strategies and the techniques that Gary has told his students and CFP candidates to use to pass this exam on the very first time, we're also going to talk about what you need as a career changer, and what you should be thinking about as you go down this journey.

00:01:15
Dominique
We're also going to be talking about where the financial planning profession is headed. There are a lot of things in regards to robo-advice and technological advances that may scare you away from this profession. Gary is going to reinforce and underscore the importance of really good financial planning and why only humans can do that. I want you to sit back because you're going to leave this conversation with knowing what it takes to pass this rigorous exam so that you can be a successful financial professional and create those deeper relationships with your ideal clients along the way. And now for our conversation with Gary,

00:01:53
Dominique
Welcome to another episode of the conversations for financial professionals podcast, where we are shaping the next generation of financial advice. Today, we have Gary Clement. You are the president of Clement asset management, a financial planning and investment management firm. You're leading structured at Kaplan, a certified financial planning program. You're an adjunct professor at the college for financial planning, assistant professor at University of Alabama. I mean, you're, super-duper credentialed in the financial services field holding several designations. I'm not, I'm happy to not only call you a colleague, but also a friend. Welcome to the podcast, Gary.

00:02:45

Gary

Thanks. Dominika I'm so glad to be here.

00:02:52

Dominique

Yeah, man, it's been great. It's been great to have our relationship over the months. We, kinda met early, I guess, 2020 or something like that. I guess I want to just kind of ask you, if you could sum up 2020 in one word, what would that be and why?
00:03:00
Gary
Oh man, it's been a real challenge all the My one word is challenging and challenging on a personal standpoint, just dealing with the changes that we all, I have had to deal with in terms of staying away from people, practicing good practices, meaning keeping masks on, staying away six feet away from people being cognizant of not being in places that could potentially be dangerous. That's meant that there's been a lot of changes, like changes with regards to how we do things, why we do things. It's been interesting, but there's been a lot of advantages to it. I've been an early adopter of zoom and that has helped me deal with a lot of this because we get a chance to at least approximate some of that person to person interaction with zoom. It's not the same, but it's close.

00:03:56
Dominique
No, no. I get that. I, and I, I really resonate with the whole, what I would call reflective nature that, 2020 has afforded a lot of individuals, including myself to not only kind of zoom out and look at what I'm doing personally, how I'm growing as a human, what goals I'm achieving, but I've also seen a lot of my clients and prospective prospects, prospective clients, have that same approach to, I I'm wondering if you've kind of noticed that on the business side of things and maybe even to, into academia. Yeah.

00:04:29
Gary
I've noticed that as well. One of the things I've also noticed is that I, as well, as many other people have had to really guard our mental health, because we're not connected to other people in the same ways that were in the past. We have to find ways or had to find ways to circumvent what could be a really lonely experience when you're not, and connection with other people and in relationship with other people and try to find ways to maintain your connection with people. Again, zoom has been good with that, but as you said, it's also been good to slow down and take stock of the things that you should be grateful for. The things that have worked well and things have worked well and really look forward to moving into the new year and years positively. So it's done that as well.

00:05:19
Dominique
No, absolutely. I think that's a good jumping off point for our conversation because one of the reasons I want to have you on, I mean, by some counts, if you look at the surveys out there, I think an associates does a really good one that basically puts the number of “financial advisors”. We got that term in air quotes at about 350,000 men and women. As, a job description, if you will, but there's just shy of about 90,000 certified financial planner practitioners as of, I guess this last November exam, realizing that there's of overlap, in these two groups, could you kind of speak to the differences between you, between those two groups of people, financial advisors as a job description in that larger number and what you're really noticing about the difference between that person and a certified financial planner?

00:06:12
Gary
Yeah, it's actually pretty stark. Unfortunately, anybody gets to call themselves a financial advisor. There's nothing that could prevent somebody from doing that. Why, I'm the pied piper of CFP land. I'd like to say that those that pursue and ultimately obtain the rights to use the CFP mark set themselves way apart because the CFP designation is the gold standard for financial advisors and financial planners. It's because of the rigor that's involved in obtaining and maintaining those designations. So that is important. The other thing that's important is that more and more prospective clients and clients are becoming aware of it in the beginning to ask for CFP practitioners. It's important to set yourself apart by getting the designation, but also it's important because it's going to put somebody in a position to help your client in a far more comprehensive way. Unfortunately, we come from different silos in the business and a lot of times we tend to focus on what our traditional line of business has been, but just like any carpenter with only a hammer says that every problem looks like a nail.

00:07:25
Gary
Well, unfortunately that's not the way we should approach financial advice and financial planning. So the CFP definitely sets people apart. If they're going to be a financial advisor now you got to swim in that lane where there's other people that are called financial advisors, but we can make a serious distinction between those that have gone forward and gotten far more of a well-rounded education than those who haven't. And it shows.

00:07:56
Dominique
No, no. I, and I'm glad you answered that question that way. I think one of themes of what I want to talk to you about today is really inside the CFP exam. I, I guess if we make that more macro the designation itself, like, there are a lot of people that attempt this thing more than one time, right. Colleagues of ours and cause it's the rigor that you spoke about that is there, before we get into kind of some of the granularity of maybe techniques or strategies and some of the things that you're even doing and telling your students about, I wanna see where you think the industry or rather the profession is going as a whole for the person that's kind of on the fringe about, Oh, I don't know if I want to put in, two or three years of my life, for the exact, the study, the coursework, the experience and all that kind of stuff.

00:08:49
Dominique
I gotta, I gotta do it. Could you talk on that moment for where you see things headed? I mean mentioned gold standard and I resonate with a lot of these things, but you're, I think you're unique in that you not only practice, you also teach people on how to get this. So where do you see the profession heading?

00:09:08
Gary
Yeah, one of the greatest things over the last couple of years for me is I started teaching behavioral finance with a college of financial planning. I am so Dominique, the future of financial planning is going to run through behavioral finance. So, I mean, and this is something that I always thought, but I'm so much more sold now because I always used to tell clients and prospective clients that and students as well, that personal finance is more personal than it is finance, meaning it's more about somebody's behavior than the numbers. That's something that's being recognized more and more. We know that behavioral finance attempts to explain the, what the why and the, how people make decisions, but it implicitly recognizes that there's a difference between rational financial decision makers and irrational financial decision makers. Now, the bottom line is, we want to assume, and we're taught to assume that people are rational decision makers, right?

00:10:10
Gary
Unfortunately we know that most people are not rational decision makers, but that just makes them normal. We've got to recognize that we're trained as technicians, were encouraged to adhere to what's called traditional financials, which is assuming that people are going to be rational. Unfortunately, we know that many people will not be rational, but the big thing about behavioral finance is that people make suboptimal decisions in somewhat predictable ways. We can understand the ways that people are making suboptimal decisions. We stand a good chance of really helping them in the bottom line is, look, the industry is inundated with global advisors with computer algorithms, with websites and what nothing's going to replace people. Advisors can bring that human element to the relationship that can't be reproduced in any other way.

00:11:08
Dominique
No, I'm glad you brought up that point. I think, obviously we, I've had you on before we've talked about this. I've had, also Kevin Calvin Williams, talk about this aspect of the irreplaceability, if you will, of human interaction, just the ability of simply able to notice somebody changed their demeanor or their body language on a zoom call or across the table, where algorithm's not going to be able to do that. To the point that you're making about behavioral financial, I think this is a large component of it, or at least some characteristics of advisors that need to be cognizant of what is included in that topic is the fact that, is to your, I guess from your purview, is the CFP actually capturing those nuances that I'm talking about in behavioral finance, in the curriculum and helping those that will use those marks in the future.

00:12:07
Dominique
Understand what you just said?

00:12:09
Gary
Yeah, that's the tough one right now. The CNP has that as part of the curriculum. It's I think it was instituted somewhere around three to five years ago. It popped up in the curriculum. It's becoming more and more of a, of the area that's going to be focused on, but I think that it's difficult to test that it's difficult to figure out well, how do we, not only give this the weight that it deserves, but how do we assess now whether someone really understands this and can put this in practice. That's something I think is a work in progress more than anything else. Now, of course, there's other entities that are popping up that are really doing a good job with regards to getting people comfortable with the behavioral aspects of financial planning, and I can rip off many different names, but the bottom line is there's no shortage of places to go.

00:13:09
Gary
If someone really wants to really get steeped in behavioral finance, even though it still is a relatively minor piece in a zap curriculum right now. I expect that it's going to be a bigger and bigger piece as the years go by. It's just, how can we test it? How do you test behavioral finance, I don't know yet. So that's something that's difficult to create. Yeah,

00:13:35
Dominique
I think that the other thing, the nuance about that we're hinting around, but I'll just say it is that, consumer demand drives a lot of this. Right. People have, let's call it evolved from the days of discount brokers. Even before that commissioned salesmen, largely, probably with insurance and annuities and things of that matter, mostly fixed products, to, then getting into this, assets under management, whether it be fee only or fee based, from a standpoint and now comprehensive financial planning. I mean, we're throwing a lot of these, things in front of the consumer to then digest and figure out how it works into their own personal financial plan in a very human way, in a very relatable way. The industry obviously has to do some catch-up with training it's PRactitioners on how to continue to evolve as quickly as the is consuming this type of information and dictating to you the way that they want their money to intersect with their life.

00:14:37
Dominique
Right.

00:14:38
Gary
Exactly. Exactly. And, thinking of those lines, 12 Dysport TD Ameritrade, Morgan Stanley just bought E-Trade commissions are going down to zero and there's going to be a need for us to continue to show the value that we bring to clients. If it's not what we can do with them with regards to investments, if it's not just a plan and it never was just the plan. Right, right. I always said that the last piece in the financial planning process, which is monitoring should be motivated because if you can't motivate somebody to do what they say was important for them to do to complete or accomplish their goals and objectives, then what are we doing it for all of this meaningless? So how do we take the ability to not only help somebody plan your future, the life that they want and have them move forward towards that.

00:15:39
Gary
That I think is all about behavioral finance, how do we alter somebody's behavior so that they're doing the things that are going to put them in the stream to get to where they want to go?

00:15:52
Dominique
No, I love, this is the benefit of interviewing and having a conversation with someone that actually teaches this. Cause you just so easily weaved in one of the steps of financial planning. Let's go ahead and let's take that. Let's take that rabbit trail into this vein. I want to talk about, really kind of peeling back the onion of, not only the exam, but the rigor of it. I, I know I've talked to people like yourself, Dr. Preston Sherry, who's mentioned that he's seen PhDs in finance, like try to sit Cole for this exam and not be successful. This is not an exam to take lightly. I know that I've had experience with the CFA first level and it's a different beast. It's a different animal with the domain of knowledge that you're responsible for. I wonder if you want to just kind of talk lightly about, kind of some of the coverage areas there, and then we can kind of dive into, top tips and strategies for passing things.

00:16:54
Gary
Yeah, of course, the coverage areas are well-defined, it's general principles of financial plan, it's insurance, it's investment planning, it's tax planning, it's retirement planning and income planning in retirement is a state planning. So all of those are important. The thing that's great about it is what I mentioned before. It really gives you a comprehensive view of the industry and what can be done to help a client. I think that is the true value of going through this process because you see that there's a lot of different ways to skin a cat in a lot of different ways to help a client gain perspective on what they want to accomplish and then go forward and accomplish it.

00:17:39
Dominique
Yeah. On average, what are you seeing? So I think the current pass rate is around 60%. Sometimes it hovers in the mid sixties. What are you seeing as the average time from start to finish when somebody says, okay, I'm going to pull the trigger on, the coursework, which is usually the first domino to kind of fall. Right. Isn't it enrolling in that first course? What do you see, is that the average time from start to finish? I know I've been telling people, give yourself nine months. I've, I've read people, who've done it as quick as six months. Obviously you have the, kind of the anomalies where you can do a transcript challenge or something like that, but let's just say cold turkey I'm coming in. How long on average does it take?

00:18:21
Gary
That's a good question. I'm one that thinks you are really looking at about nine months and let's make a distinction between the education classes and preparing for the exam. Certainly there are a lot of accelerated classes do self study. You could go through it far more quickly. Most certification classes are going to be one class for two and a half months. It's going to stretch out over a period of time. Certainly if somebody is taking these classes as part of a college program, it's going to spread out over a long period of time as well. I think nine months, even 12 months is a good, I guess you could say, what's the word I'm thinking about? It's a good estimate with regards to how long to take now. I want to make another distinction there too, with regards to the education process. This is really for those folks that are doing self study.

00:19:17
Gary
A lot of times people can get bogged down in studying for each and every one of those classes. This is true with those that are in normal classes as well, almost say normal live classes as well. The major thing that I tell folks is the education process is your first pass through all this information. You don't need to memorize all of it at that point. The focus there should be, how can I get through this and get through it as quickly as possible, getting the requisite grade, I need to move on to the next class. There's a reason why I say that because this thing is about multiple passes through the information you're going to need to, after you finished the education process, go back to page one day one and go through everything again. When you do that, you're going to need to go back to page one day one and go do it again.

00:20:11
Gary
Maybe upwards of 10, 15, 20 times. No one, let me not say no one. It's the very rare person that is going to be able to understand everything that they go through in this huge body of knowledge and understand it the first time, don't worry about it. You're going to have plenty of opportunity to do that in the education process. The main thing is to get that ability to register with the board so that now you can prepare for you review class and prepare for the board exam.

00:20:48
Dominique
Now, before we get on to, okay. Before we get onto the part that you have to, actually prepare for the exam, cause that's like you said, that's a different beast. I wonder if you have any, particular, I guess advice for the, I just came from a totally different disciplines. Let's say I'm a career changer. I'm 15 years in as an engineer, but I've been helping my people with, my friends and family with personal finance and I'm like, Oh, you're not looking into this. I go, there's a lot of different things out here. There's AFC, there's CFP and they'd start to gravitate towards CFP. Cause I've talked to a lot of these people. What would you say that 12 months could still apply to them? Or would you kind of give them maybe a more elongated because if I'm just doing the math, I know I did Dalton courses, six classes, time, eight that's, 48 weeks with no breaks.

00:21:42
Dominique
That's almost a whole year right there. I mean, maybe they get longer just because they're coming in to finance cold possibly.

00:21:49
Gary
Well, I think it still can be done in 12 months. Perhaps it would be good for somebody who doesn't have a background to take longer. One of the things that I like to say about that is this, there's a distinction between CFP test world and the real world.

00:22:08
Dominique
I'm glad you brought that up. Yeah. Okay.

00:22:10
Gary
Many people that are practicing or studying for the CFP board exam who are in the industry, they sometimes get challenged around the way we do things in the real world versus how it's done in the test world. Somebody who doesn't have a background in the industry can say, they've got an advantage because they don't have that background. They're going to do what is mandated or told to them that they should do without that background going on in your head. While it certainly could be an advantage for somebody that has a background and maybe they're able to go through it quicker, we could say the same thing for somebody that doesn't have a background because they don't have these preexisting, beliefs about how you do things in the real world.

00:22:57
Dominique
This is a good point because no, I didn't do my CFP. I didn't start my CFP coursework until 15 years into the game. I had already finished my master's degree and I actually did a transcript challenge to satisfy some of the classes. To your point, studying for the CFP exam, I had to work to remove some filters. Cause I was like, I'm already practicing with clients. This is not how this works in the real world. To, to prepare for what you need information wise in order to pass the test successfully is not necessarily a one-to-one mapping to what you would do in a client situation.

00:23:37
Gary
Exactly, exactly. That's what I think there's something that, those of us in the industry, we've got to really make that distinction in our minds so that we don't fail to put the appropriate time into a specific area that we need to study. That we don't assume that the way it's done in the real world is how it's going to be tested on the exam.

00:24:04
Dominique
Talk about that for a second, because I would imagine you talk to just as many, probably way more people that attempt this exam and don't pass on the first try. What have been, let's call it the, maybe top two or top three reasons behind that is it. I would imagine what you just said has to be very high on that list.

00:24:29
Gary
That's one of them, but that's not really the main one, the main two. I'd say if there's two reasons why people don't pass the exam, one is they don't take it seriously enough and they don't put in enough study time. That's the major reason. I think a lot of that, especially for those that are those of us that are in the industry, we might assume this is similar to a FINRA exam. It's not. This exam. Doesn't bear much resemblance to a FINRA exam. That's the first one, don't put in enough time. No one put in enough effort, don't put in the kind of study that it takes to get through this exam. The other thing that I think is a major issue is people taking too long on questions on the exam. This is a corollary to what we talked about before you shouldn't take too long going through concepts and the education process.

00:25:24
Gary
Even when you're studying, you want to begin to build speed. You've got 90 to 120 seconds per question on the exam. And the exam is hoping that test takers do, is take too long and questions so that as the test goes on, they start running short on time. Questions that they could have answered now they're rushed in hurry. They may misread the question, jump to a conclusion and answer a question wrong if they could have gotten right, because they took too long on other questions. The bottom line is, as you prepare for the exam, you've got to really develop your internal clock. When you're bouncing up against two minutes and you don't have answer for a question, you got to mark your lucky answer or your favorite answer, mark it for review and go on.

00:27:38
Dominique
Okay. You're a, you're hitting on some goldmines of stuff, especially for people I know that are maybe going to sit for the March, 2021 exam, which is the next one coming up. I think one thing that I want to kind of bring out or tease out is this notion around not spending enough time, like underestimating the amount of time that you need to spend, because I think the time component, if you spend enough, we'll help you with, let's say the familiarity that you need to have around a particular question. If you're in the test bank and you see something, post or you like four or five different ways when you get on the test, pretty much, you're gonna be like, Oh, I get how this question looks instead of it being something new. So talk about this time spent. Cause I, I, I remember distinctly a candidate for, I think sat for the November exam in 2020, if I'm not mistaken.

00:28:26
Dominique
We went back and forth on direct messages and it basically got to, the question of me asking, well, how much time did you spend? And they were like, well, I spent the time that they told me, and this is not the first time that they failed. I wonder if you have a rubric because if I'm not mistaken, the example that I got gave me a number that I should be shooting for as far as total time to study for this exam. What do you tell, what are you telling people?

00:28:59
Gary
Well, what's in the booklet is 250 hours. I don't mean to, I'm going to be honest with you, Dominic, it's going to take as long as it takes for anybody. I say that's different for everybody, but you want to think in terms of 300 hours or more, and you want to think in terms of when you're doing questions, 5,000 questions, and if you can do that, then you stand a good chance on the exam because you're right. There's only so many ways that questions can be asked about different concepts. You want to be very cognizant of the different ways they can be asked. You want to be cognizant about ways that they're going to try it on steer you away from the answer. You only get that by doing question on top of question. Now, the thing that I always say about this is about perspiration and not inspiration.

00:29:56
Gary
300 hours is also just a guideline. I would like people to do even more than that. You got to do whatever you got to do. And you got to let,
00:30:06
Dominique
You're not sitting in there again to take the exam is.

00:30:08
Gary
Say in terms of this is the only time I'm sitting in here. Look at the general pass rates or 60%, but first time pass rates are 64% from the last test in November, the repeater pass rate for November was 45%. What does that tell you if you're going to be repeating this exam, your chances of success are less. So.

00:30:33
Dominique
It is just because there's a, maybe a CA overconfidence going on overconfidence bias with what, like, I kind of went over this. I only need to study this part that I messed up on. From the last time.

00:30:44
Gary
People lose confidence, it moves confidence and they start to doubt whether it is they can do it. To be honest with you, people who may have not taken it seriously and putting enough time the first time often do that the second time and the third time as well. So there is no shortcut. You got to put in as many hours as humanly possible. That's why are 300 hours is just, it's just a guideline. It's whatever it takes for you. Now, I say that when you're done with the education process and you're preparing for your view class and the board exam should be no less than three hours a night before, if you can do it. On the weekends, maybe six on a Saturday and six on a Sunday. If we're talking about three months between end of an education process and the exam we're talking about over 300 hours, but if you gotta put in more time, then you got to put in more time and only the person preparing for the exam can gauge that.

00:31:46
Dominique
Well, and I, I mean, candidly, my numbers and I've shared these before, I finished the education capstone August, 2016 ish, sat for November, 2016. There's my three months, but I know I average 15 to 20 hours during that 12 week period a week of stay. It is what it was. This was someone that, I mean, I had a background in finance. I worked in the industry at that time, but in my, to your point, and somebody told me this early is you do not want to have to prepare for this again. So make this your only time. I took that to heart and that's, I think that was a big element in me being successful is because I did put in the time I, I actually make this, I guess, somewhat of a joke is that when I got there, I actually felt over prepared.

00:32:37
Dominique
I felt like my practice exam harder with the rigor I put myself through. I got there, I felt really well prepared.

00:32:45
Gary
Yeah. I think that's what, test takers should do. I mean, I'm in the same boat, when I was getting ready for the exam, I studied three hours to four hours a night and I studied more on the weekends. I took no days off and I built in because I was going between jobs two weeks from the end of that job, through the new job. The weekend prior to the new job was the test date. For that two week period, I studied anywhere from 10 to 14 hours a day. I went into the library college, local college library when it opened. And I left generally when it closed. My whole mindset was that over kamikaze pilot, like you said, I'm going in screaming. It's a one way trip, I'm not coming back and that's the mindset that helped me get through it because I didn't want to go through that kind of effort again.

00:33:38
Gary
And it gets harder. That's the thing. I think that's the other reason why the repeater pass rate is so much lower. It gets harder because after having put an effort like that, put in an effort like that to then have to motivate yourself to do it again.

00:33:57
Dominique
This is a good point. I never thought about it from that angle, but yeah. Yeah. I was thinking maybe there's an overconfidence. It, matter of fact, the young individual that I spoke with, that I referenced earlier, they were like, I think the first time that I did it, or the second time that I did it, I was, this was my mistake. I felt like I knew this, but then I didn't go back and study that kind of deal. It brings into the light of what you said earlier, which is, and this is how I want to kind of tie in, asking a question about reviews is each time you do it, you have to do it. Like it's the first time, there is no retention necessarily acknowledged that is going to help you. It's like, you need to prepare for this as if it's new again.

00:34:40
Dominique
I want to follow that up by asking, do you strongly believe in, like purchasing a review program or having some type of review course that you do after the education for individuals?

00:34:54
Gary
Yeah. Review course is a must. It's it shouldn't be thought of as a nice thing to do something. That's not a mandatory, it's a must. You got to have a review class, and there's a lot of reasons for that. It helps you focus your study. That's number one, number two, you'll get a lot of tips by going through the review class and the review provider, giving you those tips just before the exam, which is the vital time you need them. To get the most out of a class, what I tell students is this, you got to prepare for the weekend or your view of class. Like that is the weekend that you're taking the test because you want the review class to be just that you want it to be a review. You do not have the time to learn all of this stuff in your review class.

00:35:45
Gary
Not only do you not have the time, it's not going to happen. You've got to put your best foot forward, put in as much time as necessary in getting back to what you were saying a second ago, gets back to those multiple passes through the information you should go through at least 10 times before review class. One of the great things about going over the information over and over again is that every time you go through it, you'll go through it faster because the things that you're not going to spend as much time on. The things that you're not quite as clear on, you can spend more time on, but over time going through it over and over again, those things that you don't know as well are going to be fewer and fewer as you go forward. You should build in the idea that by going through this, you're going to reach a point where you can go through each section in a matter of hours.

00:36:39
Gary
Not days when I was going through that period where I was preparing for the exam, I was able to go through each distinct section in four hours. Now, not everybody's going to be able to do that, but I promise people that if they go through it enough, they'll be able to go through an entire section extremely quickly.

00:37:02
Dominique
What are you seeing from, you've got a lot of, you got a pretty large sample size of people from Kaplan, people from college, for financial planning, even at the university level, teaching this stuff. What are you seeing? and I want to use this time for obviously we've gone through it, but anything that you can kind of think of that we haven't covered, from a best practices standpoint, what you're seeing, the most successful candidates do. I know we say the time spent obviously, the review course is a must. I know, I, I think I hear a lot and I've even said this before. I've probably been guilty of saying this, that if you do it at the undergrad level, you can choose whether or not you want to do a review or not just because it's been, so, and fresh for you. You've probably been doing it for the last two years or not.

00:37:51
Dominique
So, take your, pick your poison there, any other top, kind of strategies or tips, cause, and really maybe speak to the career changer. Cause I get so many people that are thinking about this as a career and they haven't really decided if they want to, fully commit,

00:38:07
Gary
Yeah, yeah, absolutely. I do want to make a point about those that go through the process at a university in a degree grant program, it's even more important for them to go through you class because many of the classes are taught on the college level, and tend to be courses that bring a lot of it. A lot of into the class that are not necessarily things that are tested. The great thing about a review class is review class focuses. What is going to be tested. The other thing is because it's been a two year period, it's going to take somebody some time to go back to reacclimating themselves, to what they went through in general principles of financial planning. I think it's even more important for them. The other thing is, the classes at, Caplin per se, they are focused on what you need to know to pass the exam.

00:39:04
Gary
That again is different than what you might find a college degree granting program where it's designed to help you learn, but not necessarily pass the test. That I think is a big deal. The other thing with regards to preparing for the exam and preparing to get through either as a career change or not, the major thing is you gotta really change your mindset, your study mindset. Number one is everybody is motivated when they start this process right.

00:39:38
Dominique
Everywhere. There's like, 5,000 people that start off, but not everybody finishes.

00:39:43
Gary
Everybody's motivated on day one, but motivation is not enough is consistency of effort. That's going to get somebody through. It's studying day after day. Sometimes that means you've got to negotiate with family. You're not going to be doing the things that you were doing. Sometimes it means you're not going to watch those things that you wanted to watch on TV. Well, guess what? That's not an issue nowadays. When, when I took the test, that was an issue. Now you can pull it up anytime you want and get in that mindset that you'll have plenty of time when this process is over to watch the masked singer or whatever it is that's out there that could be a distraction for you. The other thing is you have to recognize that yeah, consistency of effort is important and times are going to get tough in terms of studying.

00:40:39
Gary
Sometimes you're not going to want to study. Sometimes it's going to feel like drudgery. Sometimes it's going to feel like an obligation. You have to stop thinking about studying as something you have to do and think of it as something that you get to do. In other words, you want to think about studying as an opportunity and not as an obligation. So.

00:41:03
Dominique
I, I mean, just, I want to, I have to park on that point because I'm thinking about, although as a certified financial planner, as a practitioner, you're not going to be in this mode of constantly studying, but you will be in a mode of constantly acquiring knowledge and to some degree studying your client or the market that you want to go into. To have this, I guess this, the posture of always learning, I think is a good thing right now. It may not always look like I got to study to pass an exam, which hopefully makes things easier for people. I love the way that you put that in that there's gotta be this attitude and mindset of wanting to learn and you getting to learn not so much. Oh, I just got to check this box. Yeah. To a certain degree, you do have to check the box.

00:41:56
Dominique
You will never be able to use the marks unless you pass the exam. To kind of maybe game-ify it or whatever you need to do in your mind to make you start falling in love with learning, I think is a good approach.

00:42:10
Gary
And that's what it does. Thinking about it as an opportunity does game-ify because there's a pot of gold metaphorically at the end of this process, right? You help yourself tremendously because you got knowledge that you didn't have before and it can help you with your own finances. Certainly it helps your family and helps your extended family and your friends. And this is where we're going. It's going to help the clients. So this is a huge opportunity. Any time it starts getting tough, cause it gets tough for everybody. If you just reorder your thinking and think about it as an opportunity, those tough days will be easier to get through. Hopefully there won't be that many of them. Those are the things that I think that are part of the study mindset. It gets back to what I was saying before about this is a process that's about perspiration, not inspiration.

00:43:02
Gary
You can't wake up two weeks before the exam and get inspired and hope to pass the exam. It doesn't work like that.

00:43:10
Dominique
No, I get it. I get it. All of my audience, that's listening, they may not realize some of the efforts that you're definitely putting your money with your mouth, where your mouth is not only where you're actually, getting paid to do that, in a, a practitioner standpoint or from a participant of academia, you and, a colleague of ours, Keith Beverley, you guys have undertaken helping, our community, black men and women actually prepare to pass this exam. I want you to kind of speak to that about the efforts that you guys have going on there. If I'm so inclined how somebody could participate with that particular effort.

00:43:55
Gary
Yeah. That has been something that we chose to do to have an impact on the numbers of African-Americans that are represented in the industry is certainly the numbers that are represented among CFP practitioners. Now we know that of those 80,000 or 90,000 or so CFPs that there are about 1.2% that are African-American. Of course there's a lot of talk about how to change that. The bottom line is talk is cheap, right? You gotta do something. We decided that we were going to do something by helping people, get much of what were just talking about to reorder their study strategy, to reorder their study mindset, to begin to tackle the exam in a way that would help them be more successful. I probably should have told you this before yet beforehand, but, this is something that we did as a, an objective ending in year 2020. Our objective was to help 20 African Americans get their designation by the end of 2020.

00:45:10
Gary
And we largely met the goal. We didn't quite need to go. Whether we're going to do that moving forward or not is still up in the air. I don't want to leave anybody with the, code that we're going to continue to do this because, we've put a lot of time in and we definitely were able to see what works on a granular level on test taker by test taker basis. That's part of the reason why I can say some of the things that I've said with a lot of confidence, because I'm pretty sure at this point what it takes to pass this exam. It's one of the exams that it's going to be, if not the most difficult for people, one of the most difficult exams that anybody could take. Definitely, something that is still up in the air. Let's put it that way.

00:46:04
Dominique
Well, no, I think, whether you guys move forward with that effort or not, because I, I just think it needs to be highlighted because there are so many conversations I have, and I know you have them, Keith as well, where, you hear the refrain of, well, there's nobody out there to support you. There's, there's not enough help out there. It's like, well, where are you looking? Because, there's a lot of things going on, efforts that you may or may not know about. I think this gets back to some of the things that I've talked about, in prior podcast about what people need to do in order to get started in the industry. One of the main things that I tell people first is to do their homework, do their research, see what's out there, the quad A's and the FPAs and the NAPFA is, and all these different organizations of the world or where you can find, efforts like what you just named and other, I mean, study groups, mentors, sponsors all kinds of things.

00:47:01
Dominique
There's no reason I guess is my point that you have to go at this alone. There's absolutely no reason.

00:47:08
Gary
Let's look at it this way. There's an old African proverb, right? It says, if you want to go fast, go alone. If you want to go far, you go with others. This is a test that requires that you go far. I recommend that nobody tries to do this on their own. It's difficult. If it takes a mentor, get a mentor, if it takes a group, get a group. The great thing about groups is that together people are going to be able to fill their individual shortcomings by other folks in the group who understand that particular information better. The other thing is it's an accountability issue. If you're coming to a group meeting where people are expecting you to be prepared, then that is a commitment that you're making to others. Sometimes it's easier to make that commitment and follow through it with it, for others than it is for ourselves.

00:48:03
Gary
Those are the kinds of things that can create the kind of motivation to move forward. The other thing that's good about it is sometimes these evolve into friendly competitions and that's a good thing. All of these things can help people get through the daunting period of getting ready for the exam.

00:48:23
Dominique
Not just that, I think, I mean, I'm pretty sure that you've seen this. I know I've seen it in the industry where those groups form into, maybe even partnerships to build firms or definitely, at a minimum someone that you can have in your network that can vouch for, your character or your study ethic, all these things. So I think that's great. Absolutely.

00:48:49
Gary
Oops, I got a lot more tips, someone wants it, if you want some more tips.

00:48:54
Dominique
Yeah. I bet you do. I bet you do. I think I want to reserve some of that because you and I have talked offline about some things that you may be doing, so they just, they need to get in contact with you because you're a wealth of information. I, I want to, as I kind of close our conversation, I want to ask, since this is a podcast to help empower, tomorrow's financial professional with tools to serve their ideal client at the next level, in that context, Gary, what word of wisdom or wisdom words, would you leave with the audience today?

00:49:32
Gary
Yeah. I go back to behavioral finance, understand that it's the personal relationship more than anything else. That's gonna be important as you deal with clients, the information you can get, if you don't have it, you can get it from somebody else or you can study. That's not the issue. The issue is how you actually advise your client, how you actually interact with your client and how you support the client, meet the goals and objectives that are important to them. That is the most important thing. I know, especially those of us who got in the business in the investment side of the business, we probably were thinking, Hey, we're going to move. We're going to set somebody up and make all this money from investments. That's never been what it's always been about. I had to learn that the hard way. I remember cold calling the guy who was a, a tangential family friend.

00:50:32
Gary
I cold called this guy over and overwhelmed after a while it wasn't a cold call, but I called this guy repeatedly. And, he was putting me off, put me off. Finally, one day he said, I'm really not looking to establish another relationship. I'm sitting here thinking I got a girlfriend. I don't want no relationship. It years had not dawned on me that this is what is required of financial advisors to really understand the client, understand what's important to the client, understand what the client is trying to achieve and helping that client as not just a financial advisor. This is in keeping with what I've been saying as a coach. That really is hand in hand with now understanding behavioral finance on a better deeper level, because what we do really is about counseling and coaching.

00:51:36
Dominique
No, I think that's a, I think it's a beautiful way to put it. I think it's a great way to, tie and put a bow on this is understanding that yes, we have the competency levels that we need to get to, whether we're deciding CFP or PhD or AFC or whatever, all these different letters we can put after our name, but at the end of the day, it's about building that relationship with the client to take them to the next level. I love it, Gary climate. I really appreciate your time, man.

00:52:07
Gary
Of course. It's my pleasure.

00:52:09
Dominique
All right, man. Absolutely. We'll talk to you soon. Bye-bye!