The CFP® Exam does test your knowledge of financial formulas and calculations, so you’ll need to know things like how to determine the internal rate of return (IRR), unequal periodic cash flows, and amortization schedules. But while you need to understand the formulas and how to calculate them, you can use a financial calculator to do the heavy lifting. CFP Board is tough, but they aren’t monsters.
Before you get too excited about the prospect of a CFP calculator, there are some CFP Board rules you need to follow plus some best practices that will prevent a calculator-related horror story (Yes, they exist—we’ve heard them.). We’re here to share everything you need to know.
Listen up: Jerry is providing more information on financial calculators in this episode of BIF Bites!
First, CFP Board only permits you to use specific financial calculators on the CFP® Exam.
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Hewlett Packard (HP)
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Sharp
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Texas Instruments (TI)
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This does include newer and older versions of the calculators, as well as the variations like plus, pro, or platinum, as seen above.
See it in action: Check out the video below to get a quick tutorial on how to use the HP 12C financial calculator.
The computer you use at the Prometric testing center will have a basic calculator app built in for completing math, but you are allowed to bring in your own simple calculator, too. It just can’t be a graphic calculator or anything like that.
On top of what type of CFP® Exam calculator you’re using, CFP Board also has rules governing usage.
Once you’re at the Prometric center, the exam proctors will inspect your calculator before you sit for the exam. They may ask you to pop the batteries out of the back of your calculator to reset it to factory settings, so technically, you may not need to clear your memory, but it’s just a good practice to speed up the check-in process.
Remember how you don’t want to be a calculator cautionary tale? Here’s how to avoid that.
CFP Board does allow you to bring batteries into the exam room, so make sure you pack extras because the last thing you want is for your calculator to die halfway through the exam. Just make sure to take them out of the packaging before you go into the exam room. Better still, borrow an extra calculator from a friend or co-worker. This way if something does happen, like you drop your calculator into a puddle on the way into the testing center (Yes, this actually happened!), you won’t feel compelled to drop to your knees in the parking lot, screaming “I am fortune’s fool!” or something equally, tragically Shakespearean.
Many calculations on the CFP Exam involve multiple steps, like calculating mortgage amortization or conducting a retirement funding 3-step calculation. Write down your answers at each stage on your scratch paper—case study questions love to ask you to reference earlier results. Recording each step saves time and prevents you from redoing work if you need to backtrack.
Don’t switch out your calculators mid-way through your exam prep and definitely don’t try a new CFP calculator on exam day. Choose one approved model as you start preparing for the CFP® Exam and get to know it so you can devote all your concentration to doing the work correctly.
There’s not really a “best” calculator, but here are our TOP 3 along with some considerations to help guide your selection:
Pro tip: BIF provides detailed instruction and full support for both HP 10bii and HP 12C users
If you’re preparing for the CFP® Exam, The BIF Review teaches you exactly what you need to know in a concise, streamlined prep course (including using a financial calculator for the CFP® Exam). Try it free for 30 days and see how we get you exam ready!