In the world of finance, two of the most respected and prestigious certificates are considered to be the CPA (Certified Public Accountant) and the CFP (Certified Financial Planner). This blog will give you a distinct idea of CPA vs CFP in today’s job oriented market. Both certificates provide the required skill set and knowledge required in the distinct roles in the financial industry.Â
In this blog, we’ll explore the differences between CPA vs CFP certifications, what each entails, and their career prospects, and help you determine which one might be the best fit for you.
What is CPA?
The Certified Public Accountant (CPA) is a professional certification in the field of accounting, finance, and taxation. CPAs are licensed by state boards of accountancy in the United States and are authorized to perform a range of duties, including auditing financial statements, preparing taxes, offering financial advice, and providing assurance services to businesses and individuals.Â
To become a CPA, one has to pass the CPA exam. The CPA exam is considered to be rigorous and has a comprehensive scope. With proper hard work and dedication, one can clear the exam and become a  CPA. CPAs often work in public accounting firms, private industry, or government sectors.Â
What is CFP?
The Certified Financial Planner (CFP) is a professional certification awarded to individuals who specialize in personal financial planning. This certification is granted by the Certified Financial Planner Board of Standards, Inc. (CFP Board) and focuses on helping individuals with comprehensive financial planning, including retirement planning, estate planning, investment management, tax planning, and insurance planning.
CFPs work closely with individuals to help them set and achieve financial goals, providing tailored advice that helps them manage their finances over the long term. A CFP is typically hired by individuals seeking guidance on building a financial portfolio, managing investments, or planning for retirement. The role of a CFP is client-focused and requires strong interpersonal skills to communicate complex financial concepts to clients.
CPA vs CFP: Key DifferencesÂ
Let us find out the key differences highlighting CPA vs CFP:
| Factor | CPA | CFP |
| Exam Difficulty | The CPA exam is well recognised for its difficulty. At its core, the subject matter focuses on accounting principles, tax laws and business regulations. | The CFP exam tests knowledge in areas of financial planning, investment planning, estate planning, and insurance, and is less focused on technical accounting principles. |
| Syllabus Breakdown | The CPA syllabus covers subjects such as auditing, financial accounting, regulation, business environment, and taxation. | The CFP exam is a single, comprehensive exam that covers multiple areas of financial planning and personal finance management. |
| Exam Pattern | The CPA exam consists of four sections: Auditing and Attestation, Business Environment and Concepts, Financial Accounting and Reporting, and Regulation. | The CFP exam is a single, comprehensive exam that covers multiple areas of financial planning and personal finance management. |
| Exam Fees | CPA exam fees vary but generally cost between $1,000 to $3,000 depending on the state and registration fees. | CFP exam fees range between $600 to $1,000, depending on the exam format and additional costs for the application and certification process. |
| Duration to Complete | It typically takes 18 to 24 months to complete the CPA exam and fulfill the necessary work experience requirements. | The CFP certification typically takes about 12 to 18 months to complete, depending on whether the candidate already has relevant experience or educational background. |
| Code of Ethics | The CPA code of ethics is focused on integrity in accounting practices, public trust, and professional responsibility. | The CFP code of ethics emphasizes client interests, fiduciary responsibility, and comprehensive financial planning to enhance client well-being. |
| Exam Eligibility | Candidates must have completed 150 semester hours of college education and meet specific work experience requirements. | Candidates must have a bachelor’s degree and complete the required coursework in financial planning to qualify for the CFP exam. |
| Organizing Body | The American Institute of CPAs (AICPA) and state boards of accountancy. | The Certified Financial Planner Board of Standards, Inc. (CFP Board). |
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CPA vs CFP: Career Prospects & Salaries
In comparison to CPA vs CFP, in both fields, the career prospects, opportunities, and salaries are quite high on the graph.
Career Prospects CPA: Â
Once you complete a wide range of CPA scope in India open up and become available. Becoming a CPA, a wide array of job opportunities like public accounting, corporate accounting, tax advisory services, forensic accounting, and government auditing open up on a global aspect. Holding a CPA certificate can also lead to top-tier positions like Chief Financial Officer (CFO) in large corporations.Â
Career Prospects CFP:
On the other hand, completion of the CFP certification can lead to job opportunities like rewarding careers in the financial planning industry, including financial advisors, wealth managers, investment advisors, and tax consultants, among others.
Salaries for CPAs:
The average CPA salary in the United States varies depending on experience, location, and industry. Generally, CPAs can expect to earn anywhere between $50,000 to $120,000 annually. Experienced CPAs or those in senior management roles, such as CFOs, can earn upwards of $150,000 per year or more.
Salaries for CFPs:
CFPs in the U.S. generally earn between $60,000 to $100,000 annually, depending on experience, clientele, and the organization they work for. Top-performing CFPs, especially those with a large client base, can make significantly more, with earnings reaching over $150,000 annually
CPA vs CFA: Overall Cost Including Coaching Fees
When it comes to overall CPA course fees in India, including exam preparation and coaching, both CPA vs CFP certifications come with their financial investments.
- CPA Exam Costs: As mentioned earlier, the CPA exam fees can range from $1,000 to $3,000, depending on the state and registration. Adding coaching or preparatory classes can add another $500 to $2,000.
- CFP Exam Costs: The CFP exam costs range from $600 to $1,000, with preparatory courses or coaching fees usually between $1,000 to $2,000.
Overall, while both certifications come with a significant investment, the cost of obtaining a CPA is generally higher due to the comprehensive nature of the exam and the additional experience required to become licensed.
CPA vs CFP: Which One is Right for You?
Choosing between a CPA vs CFP depends on your interests, career goals, and the type of work you enjoy. If you are more inclined toward accounting, tax preparation, and auditing, then the CPA certification is the right choice. However, if you are passionate about helping individuals plan their financial futures, then the CFP certification may be a better fit.
Both certifications open up exciting career opportunities, but your decision should be based on where you see yourself in the long term—whether in accounting and business consulting (CPA) or wealth management and financial planning (CFP).
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Conclusion
Both CPA vs CFP certifications are highly respected in the finance industry, but they serve different purposes. The CPA is perfect for those who want to focus on accounting, auditing, and taxation, while the CFP is ideal for those passionate about personal financial planning and wealth management. Ultimately, the right choice for you will depend on your interests, career aspirations, and the type of work you want to engage in.
FAQs on CPA vs CFP
What pays more, CFA vs CFP?
On average, CFA holders tend to earn more than CFPs, as CFAs typically work in investment banking, portfolio management, or hedge funds. The average salary for a CFA holder is generally higher, ranging from $80,000 to $150,000, depending on experience and role.
Is a CPA better than a CFA for a CFO?
For a CFO position, a CPA is generally more relevant as it is focused on accounting, financial management, and auditing. A CFA would be beneficial if the CFO role focuses heavily on investment strategy, financial markets, or corporate finance.
How much does a CPA earn in India?
In India, a CPA’s salary can range from INR 6,00,000 to INR 15,00,000 annually, depending on experience and the industry.
Is CPA in demand in India?
Yes, CPAs are in demand in India, especially as global businesses expand, and more Indian companies seek to adhere to international accounting standards. Additionally, there is a growing trend of Indian accountants looking to expand their careers internationally by becoming CPAs.
