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What Is a Certified Retirement Financial Advisor (CRFA)?

Mark Henricks
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No matter where you are in your career, sooner or later you’ll be approaching retirement. While you should start saving now for your post-working life, consulting with a certified retirement financial advisor (CRFA) could be one move toward making sure you achieve your monetary goals. If you see the acronym “CRFA” after a financial pro’s name, you’re getting someone who has experience and education in advising clients on investing, taxes and other financial matters related to retirement planning.

The CRFA Designation

A financial expert that earns the CRFA designation stands out from the pack of other advisors in that they have demonstrated competence in understanding the complexities of retirement planning. For example, they might advise clients on estate taxes and how to reduce capital gains; help them devise a strategy to maximize Social Security benefits; provide information on insurance products and estate planning; and give an overview of various options for funding their grandchildren’s college education

A CRFA will work to get a detailed view of your overall financial picture. They might ask you everything from what assets and outstanding debts you have to whether or not you plan to work part-time in retirement. They’ll also ask about, and plan for, any potential inheritances that might be coming your way. 

CRFA Requirements

Issued by the Society of Certified Retirement Financial Advisors, earning the credential demonstrates a finance expert’s commitment to advising on retirement-related topics. But whereas other industry certifications, like a certified financial planner (CFP), requires rigorous training and testing, the CRFA is a lesser-known and modest designation that requires much less on the part of the candidate.

Anyone can apply to get a CRFA. There are no prerequisites. However, the granting organization suggests that applicants have significant relevant work and educational experience.

Specifically, applicants are recommended to have three years of work experience in the financial services industry. This could include working in the investment industry, the insurance industry or doing tax planning and preparation as a tax professional. Alternatively, applicants may have specific job skills or classroom training in the financial industry.

CRFA Program Overview

CRFA certificate holders have received the equivalent of 24 hours of live classroom training or self-study in insurance, securities, taxes, trusts and estates. They also have to pass a test, agree to follow a code of ethics and pursue continuing education in subsequent years.

Students only have to pass the exam, which costs $595, to receive a CRFA. They don’t have to complete a specific course of study before applying to take the test.

They can, however, take a three-day seminar either live or online that will prepare them for the exam. Or they can self-study, using any training material they like. If they choose the self-study route, applicants have to demonstrate that they have 24 hours of secondary education in professional financial services.

The final exam covers six main topics: retiree tax issues, investment concepts for retirement, general retirement principles, Social Security and other government programs, estate planning and ethical standards.

After completing the seminar or their self-study program, students take a four-hour, closed-book proctored exam. According to SCRFA, the issuing body, 72% of applicants pass the exam the first time and 90% pass the second time.

After receiving the certificate, holders agree to take 15 hours of continuing education annually to maintain the designation. Renewing the certificate costs $345 a year or $295 for charter members of the association. Certificate-holders who let their certifications lapse by not paying the renewal fees have to retake the final exam.

 

Comparable Certifications

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Getting a CRFA doesn’t equip holders with any particular powers or privileges. Rather, it’s an optional certification that tells prospective employers and clients that an advisor has pursued education, passed a test and agreed to follow a code of ethics.

CRFA is not one of the most well-known or prestigious financial certifications. At the end of 2014, according to the SCRFA, only 110 people had acquired the certificate.

Compared to some financial advisor certifications, the CRFA represents a modest level of achievement. Becoming a certified financial planner (CFP), for example, requires years of study and passing a challenging examination.

Financial advisor designations similar to the CRFA include:

  • Chartered Retirement Planning Counselor (CRPC): The CRPC designation is issued by the well-known College for Financial Planning and is considered a graduate-level course of study. A CRPC has specialized training in creating retirement “roadmaps” for clients as well as expertise in asset management and estate planning.
  • Fellow, Secure Retirement Institute (FSRI): An FSRI certificate is granted by LOMA, an insurance trade association. A FSRI’s training covers a broad range of retirement topics, from investment management to customer experience.

The Bottom Line

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Having a CRFA indicates an advisor has reached a level of expertise in retirement planning and commitment to ethical practices. A CRFA is just one of a number of early-career financial advisor designations. It’s not prestigious, well-known or difficult to get. Consumers looking for help with financial planning can probably find an advisor with credentials demonstrating more significant education and accomplishment.

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