How to be an Investment Advisor without doing CFP Certification

You are a Mutual Fund Distributor, Insurance Agent or in field of selling of some financial products. You now want to move to next level which is Investment Advisor or Financial Planner. However you do not have time or money to do CFP Certification. Is there any other alternative available? Yes. Regulator itself has provided a much simpler and cheaper alternative. It is NISM certified Investment Advisor.

Though CFP is a much better recognized brand and is also considered as gold standard for Financial Planners, it is not cheap and quick. FPSB registration, exam and certification fees itself are more than Rs. 70,000/-.

Plus you need some money for course or study material. Also CFP is very much calculation intensive exams. So not everyone will clear in first attempt. This will delay your opportunity.

However if you go via NISM route, you can quickly get started. Completing NISM certification is equivalent to CFP as far as Investment Advisor registration is considered. Also this option is much cheaper as we will see below. Yes, I agree it doesn’t have that good brand as CFP and also level is not same as CFP.

So what should one do?

My suggestion would be to take first step and complete Investment Advisor Certifications. In very small expense, you will get good knowledge as well as certification.

Whatever you will learn will definitely help you in CFP exam as well. Both exam compliment each other. NISM certification has good theory and CFP has good practical calculations.

So your certification will not go waste. Major advantage is you can apply for Investment Advisor registration with SEBI with NISM certifications and start working. In parallel, you can start CFP preparation but at least it will not impact your advisory business.

What is cost for Investment Advisor certification?

There are two levels for exams – Investment Advisor Level 1 & Level 2. Both exams cost Rs. 1500/- each (some changes may be there when you are reading this blog). Plus you will need to purchase one book for each exam. Together both books wont cost more than Rs. 1,000/-

You can check out prices of books below and buy same from Amazon

Book for Investment Advisor Leve 1 certification exam

Book for Investment Advisor Leve 2 certification exam

So overall within Rs. 5,000/- (considering GST etc), you can complete both certifications.

How much time is needed for NISM Certifications

Now that cost is out of way, let us look at effort. Most of us are already in some or the other job or business. So it is difficult to devote lot of time for exams and CFP is little challenging if you do not have time commitment.

For NISM Investment Advisor, you will need to study something between 1 to 2 months. This is for each exam. First level is little easier compared to second one. Assumption is you are already in financial field in some way (MF Distributor, Insurance Agent, etc) and have some basic understanding about investments.

If you are coming fresh then may be 2 to 3 months would be good enough.

Every person is different but above timeline is based on my own experience of these exams for an average person. Expectation is on average 5-6 hours of reading per week. More or less, if you can read and understand their book twice before exam then you should be good to pass. So based on your general reading speed, you can take a call.

There is no need of any additional book or reading material for these exams. Just focus on their book and you should be good.

Study path

What worked for me in both the exams is spending money. Strange but true. I spent lot of time in planning when and how I will give these exams. However once I registered for exam and bought book, I had some small pressure to start preparation. That approach worked for me in both levels.

I would suggest you to also give it a try. Register for first level targeting a date in next 1 to 3 months. Buy book and give it a try. Based on experience in first level, take a call for next level.

If you are still skeptical, then buy at least Level 1 book. Spend some time going through it and take a judgement call how much time will be needed to complete reading it twice. Then register for exam.

I don’t think there is any need to spend money on mock tests but if you wish, you can do so.

Once you clear both exams (results are online and immediate), you are technically equivalent to CFP certification. You can then follow further steps for registering with SEBI as Investment Advisor or use it for branding yourself with your clients.

CFP v/s NISM Certified Investment Advisor

Before we close, let us do a quick comparison of CFP and NISM Investment Advisor Certifications.

Area of comparisonCFP CertificationNISM Investment
Advisor Certifications (1 & 2)
Certification BodyFPSBNISM
Cost of registration / exams / certificationsHigh – around 70,000/-Very Low – Around 5,000/-
Cost of study materialComparatively highVery Low – Around 1,000/-
Course Generally needed for most studentsNot needed
Level of difficultyComparatively high ( 8 on scale of 1 to 10)Comparatively easier ( 4 on scale of 1 to 10 )
Study Time High ( Around a year for working average person)Low ( 2 to 4 months for average working person)
Nature of examOnline – Calculation centricOnline – Theory and concept centric
Global RecognitionYesNo
Brand ValueVery HighComparatively low
SEBI recognition for Investment Advisor RegistrationYesYes
Comparison Table

So that’s all I have. Best of luck if you decided to go for these certifications. Do let me know your experience / views in comments. Happy reading.

3 thoughts on “How to be an Investment Advisor without doing CFP Certification”

  1. Can a person who has worked in the field of IT for domains and clients from Insurance, Banking and Payment cards, apply and appear for CFP / NISM Investment
    Advisor Certifications? If the exams are cleared, will they be eligible to apply for the certificate? What kind of work experience proof can be produced ?

    • NISM – Yes. You can do. There is no specific experience requirement as such.

      CFP – You will need to have experience of 3-5 years. I feel your experience relevant but since CFP with training course etc costs almost a lac now, better to send them mail to fpsb India team with your experience and confirm before going for it. Also as per my understanding CFP passing score is valid for 5 years so you can pass exam and then gain experience followed by certification as well.


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