Ever wonder what the difference is between a certified financial planner and an accountant? While they are both lucrative long-term career options, they are different paths. Let’s take a closer look at the similarities and the differences between these two careers!
Certified Financial Planner and Accountant Jobs
Both financial management careers offer strong job growth. With median incomes higher than the average, these two professions are great for intelligent individuals. If you love working with numbers, you’ll get heavy doses of numbers and math with both of these positions. Despite this main similarity, the two professions are quite different.
What Do Accountants Do?
Accountants do auditing work. They put together financial statements and do financial forecasting. Accounting professionals are usually focused on details. They record, summarize, analyze, and create reports that show all financial transactions. Many accountants work by auditing financial statements for a third-party firm. Others work for private companies. They can perform additional job tasks like inventory accounting.
What Do Certified Financial Planners Do?
Unlike an accountant, financial planners help with wealth management and retirement planning. They are more about sales and networking. Unlike accountants who work for a salary, many CFPs work on commission. CFPs are financial advisors that specialize in certain aspects of wealth management. They need strong sales and networking skills. Essentially, they build a book of business on their own because clients don’t get handed over to each other.
Main Differences Between the Two Professions
Here’s a list of the key differences between the two professions:
- Education Requirement– While there aren’t specific academic requirements for either profession, most have at least a bachelor’s degree. Accountants need to attain a certified public accountant This requires 150 hours of post-secondary education. This isn’t quite a master’s degree but is more than a bachelor’s degree. In addition, many firms had set requirements for hiring accountants. If you are a CFP, you need to pass the requisite securities exams, but you don’t need a bachelor’s degree. To get a certified financial planner certification, you need to pass exams in a variety of areas of wealth management and finance.
- Skills Required– Accountants need to be detail-oriented, focused, and good with numbers. The first few years require long days to establish your career. Financial planners are essentially salespeople. They network around the clock and follow the market closely.
- Starting Salaries– The pay structure of these professions is substantially different. Accountants get a straight salary. Bonuses are often given for performance. Financial planners, usually work by commission. They may also charge hourly or set fees. It’s essentially a pay by performance job.
- Work-Life Balance– Both professions require lots of work for the first few years as you establish yourself. For accountants, however, your busiest time of the year is tax season. From January to April, you can expect to work as much as 60 hours a week. Finding clients as a certified financial planner can lead to long work weeks, especially when you start out. As you get more established, however, word-of-mouth marketing can help reduce the number of hours you spend working.
Whether you are a financial planner or an accountant, both careers require a love of numbers and a strong work ethic. If you are debating between the two, the choice can be easily broken down. If you love crunching numbers but aren’t much of a people person, become an accountant. If you prefer to interact with people, becoming a certified financial planner
is the choice for you!