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Financial psychology certifications can demonstrate expertise in the ways that psychology and personal finance intersect in a client’s attitudes, beliefs and behaviors that influence their financial decisions. These certifications can differentiate you in a competitive marketplace and potentially lead to increased income and credibility.
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Benefits of Earning a Financial Psychology Certification
Financial psychology combines elements of behavioral economics, psychology and personal finance to offer a comprehensive understanding of the emotional and cognitive aspects that influence a client’s financial decisions. This interdisciplinary credential is primarily tailored for financial advisors, enabling them to understand their clients’ financial behaviors and guide them toward healthier financial habits.
Here are some of the benefits of earning a financial psychology certification.
| Better Client Outcomes | Earning a financial psychology certification can strengthen your skills to better counsel clients prone to overspending or exhibiting unhealthy attachments to money. That could lead to better outcomes overall as you guide clients through the financial planning process. |
| Business Growth | Clients who are satisfied with the service and experience you provide may be more inclined to refer you to their friends, family members and coworkers. And they may be less likely to look elsewhere for advice. |
| Competitive Advantage | Incorporating a behavioral finance approach into the way you serve clients could add to your unique value proposition. In turn, that could give you an edge in acquiring new clients or breaking into a new niche. |
| Professional/Personal Satisfaction | You may find that the work you do becomes more rewarding and meaningful when you’re making deeper connections with your clients. That could lead to greater satisfaction overall both personally and professionally. |
Advisors holding this certification can also provide more personalized financial advice by understanding and addressing each client’s unique financial behaviors and biases. As another example, a risk-averse client might be guided to strike a balance between security and growth in their investment portfolio.
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9 Financial Psychology Certifications for Advisors
Financial psychology certifications can provide advisors with the necessary tools to help clients make financial decisions and overcome behavioral biases.
While these certifications do not guarantee career advancements or enhanced client relationships, they are increasingly recognized for their potential value in the financial industry. Here are nine certifications to consider:
1. Certificate in Financial Psychology
Issuing Organization: The American College of Financial Services
A certificate in financial psychology is designed for individuals who are interested in deepening their understanding of behavioral finance. This certificate is sometimes a required prerequisite for obtaining other financial psychology credentials, and can be a precursor to an advanced degree in behavioral finance.
There are no prerequisites required to complete a certificate in financial psychology through The American College of Financial Services. You’ll need to successfully complete three courses and achieve a score of 80% or better. You’re also required to adhere to the college’s code of ethics and procedures.
2. Certified Financial Behavior Specialist (FBS)
Issuing Organization: Financial Psychology Institute
A certified financial behavior specialist (FBS) designation is typically held by a behavioral financial advisor who has obtained specific knowledge and skills to understand and analyze client financial behaviors. This certification focuses on developing skills to help advisors guide clients in making informed and bias-free financial decisions.
To obtain the FBS certification, candidates generally need a bachelor’s degree or higher from a regionally accredited institution and specialized education in financial psychology and behavioral finance. Candidates must also agree to the Financial Psychology Institute’s Code of Ethics, submit two letters of recommendation and complete 20 hours of continuing education every two years.
3. Certified Financial Transitionist (CeFT)
Issuing Organization: Financial Transitionist Institute
A certified financial transitionist (CeFT) is a financial advisor trained to help clients navigate significant life transitions, such as retirement or bereavement, which have financial implications. This certification equips advisors with the skills to guide clients through potentially stressful financial changes.
The CeFT certification can enable advisors to offer targeted support during transitional periods, helping clients make sound financial decisions during these critical times. There are two parts to the certification process: FTI training and the CeFT exam.
Only individuals who hold a Certified Financial Planner™ (CFP®), Certified Investment Management Analyst, Certified Private Wealth Advisor, Chartered Financial Analyst, Chartered Financial Consultant, Certified Divorce Financial Analyst or Certified Public Accountant/Personal Financial Specialist designation can sit for certification. Advisors must remain in good standing, maintain membership and complete 15 SMI/FTI community and continuing education credits each year to continue using the CeFT® marks.
4. Registered Life Planner (RLP)
Issuing Organization: Kinder Institute of Life Planning
A registered life planner (RLP) is a financial advisor who integrates life planning into their financial advising services. They focus on understanding clients’ life goals and aligning them with their financial strategies. The RLP certification provides advisors with the opportunity to offer holistic advisory services, where the financial and personal aspects of a client’s life are considered in tandem.
To obtain the RLP certification, candidates must complete three approved courses through the Kinder Institute of Life Planning. You must complete at least one course before you can enroll in mentorship training. Continuing education is required; a minimum of eight hours of CE credit in life planning must be completed every two years.
5. Accredited Behavioral Finance Professional (ABFP)
Issuing Organization: College for Financial Planning
An accredited behavioral finance professional (ABFP) prepares you to apply principles of behavioral finance in client interactions and investment decisions. This role is relevant in financial advising as it helps advisors understand client behaviors and biases that may impact financial decisions.
The ABFP certification helps advisors learn and develop the skills to guide clients in managing these behaviors and biases, which could strengthen their financial decisions. The program is designed for mid and advanced career financial planners who are interested in financial psychology. Earning certification is dependent upon successful completion of an exam; 16 hours of continuing education is required every two years.
6. Behavioral Financial Advisor (BFA)
Issuing Organization: think2perform
The behavioral financial advisor (BFA) designation equips advisors with the necessary skills to integrate conventional financial knowledge about markets and investing with a focus on psychology and neuroscience. This role is important in the financial advisor industry as it helps advisors understand and manage the psychological factors that influence clients’ financial decision-making.
Advisors can pursue the BFA™ designation through self-directed, supported or structured learning options. The program includes coursework, access to the BFA exam and 20 ½ CFP® CE credits. Current listed pricing ranges from $800 to $1,600, depending on the learning format selected.
Applicants will need to complete two courses related to behavioral finance. The first course will introduce you to core concepts of behavioral finance. The second will explain how to help clients understand the way their emotions can affect their financial decision-making.
7. Certified Financial Therapist™ (CFT)
Issuing Organization: Financial Therapy Association
Certified financial therapists use research and evidence-based therapeutic techniques to help clients who face psychological challenges in their relationship with money. This designation is designed for mental health professionals and financial professionals who want to take a therapeutic approach to money conversations. Advisors who earn this certification are bound to follow a fiduciary standard when working with clients.
Candidates must have a bachelor’s degree or higher in a finance-related field; a bachelor’s degree in a different field may be substituted if you hold a qualifying credential, such as a Chartered Financial Consultant (ChFC) designation. You’ll need to complete FTA competency training, have a minimum of 500 hours of experience working with clients and complete an exam. Continuing education is required, including courses in ethics.
8. Accredited Financial Counselor
Issuing Organization: Association for Financial Counseling & Planning Education
Accredited financial counselors help people with their money so they can improve their lives and overall well-being. This credential is considered to be the gold standard for life cycle financial planning and as such, candidates must pass a rigorous exam.
As an accredited financial counselor, you can help clients address their biggest money challenges, create a plan to help them achieve their financial goals and develop a plan for sustaining their long-term financial health. To maintain certification, you’ll need to pay a fee, complete continuing education requirements and abide by the AFCPE’s code of ethics.
9. Internal Family Systems Certified Therapist
Issuing Organization: IFS Institute
The IFS certified therapist designation helps you develop the knowledge and expertise to guide clients in dealing with financial trauma. For example, you may specialize in helping clients who are working to overcome an addiction to gambling or compulsive overspending. Financial therapy is a specialized service you may choose to offer if you’d like to do more than help clients choose investments.
This financial psychology certification is much more intensive in terms of what you’ll need to qualify. The certification process involves multiple levels of training and there are certain prerequisites you must meet to qualify for a certificate. That includes holding a master’s degree in human services and being licensed to practice clinically as a therapist.
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Bottom Line
A financial psychology certification can help you develop skills to offer clients more personalized advice. This interdisciplinary focus relies on both financial and psychological expertise to identify and manage behavioral habits that affect clients’ financial decisions.
Tips for Growing Your Firm
- While some certifications can help you gain credibility with clients, others can help you stand out with potential clients as you look to grow your firm. Finding consistent ways to bring in new clients is important for the future of your business. If you’re not able to dedicate as much time as you’d like to on marketing, there are ways to get help. SmartAsset AMP (Advisor Marketing Platform) is a holistic marketing service financial advisors can use for client lead generation and automated marketing. Sign up for a free demo to explore how SmartAsset AMP can help you expand your practice’s marketing operation. Get started today.
- Another great way to bring in new clients is to make sure your online presence is right. You can utilize important digital marketing strategies designed to help financial advisors grow their business.
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