Development focus: Is AF3 still the right path for me?


The CII’s Advanced Diploma AF3 pension planning unit has always been a challenge for exam candidates and caused much upset with its decreasing pass rate. Back in 2012 51.93 per cent of candidates passed. By 2015 this had plummeted to 31.47 per cent. A 20 per cent decrease in such a small amount of time should be a major source of concern.

But just as I was about to write an article on what can be done to improve pass rates, there came an announcement from the CII: AF3 is being withdrawn after the April 2018 sitting and two new pensions exams – AF7 and AF8 – are being introduced from October 2017.

If you had planned to sit AF3 before the cut-off you may be wondering whether it is still the right path for you. If it is, that leaves just three sittings (April 2017, October 2017 and April 2018) to get this 30 credit exam under your belt. Or you may like to consider other options.

AF7 is the new Pension Transfers exam. It is a short-answer written exam with two case study-based questions. It also forms a part of the new Certificate in Pension Transfers qualification (the aim of which is to satisfy the FCA requirements for undertaking pension transfer activities, although approval is not expected until February).

But while AF7 is a Level 6 exam, the Certificate in Pension Transfers is only a Level 4 qualification. It is worth bearing in mind other examining bodies offer a Level 6 qualification for pension transfer activities.

The study text for AF7 will be available from July although the syllabus is already on the CII website. AF exams do not normally have study texts, so this is interesting. It suggests the material covered will look a lot different to that in AF3, with only a small number of overlaps.

Meanwhile, the new AF8 Retirement Income Planning exam will focus on those areas not covered by AF7. Full details will not be available until mid-2017 but we expect it to cover many of the topics examined in AF3.

So where do you go from here if you were planning to sit AF3?

It depends on your individual needs. AF3 provides 30 Level 6 credits as opposed to AF7’s 20. It therefore follows AF7 should be “easier”, which should address the low pass rates we have been seeing for AF3. That said, if you are aiming for chartered, a 30 credit AF exam is a better option to get you up to the 120 Advanced Diploma level credits needed.

If your main aim is not to get to chartered but you wish to undertake pension transfer activities and have already passed R01, R02 and R04 (as many as part of the Diploma in Regulated Financial Planning have) then sitting AF7 next October may be a better answer.

The only question mark then is over the Certificate in Pension Transfers being a Level 4 qualification only. You may want to consider other options, such as the London Institute of Banking and Finance Award in Pension Transfers (AwPETR), which is Level 6.

All in all, it is encouraging to think the introduction of AF7 and AF8 should address the abysmal pass rate of AF3. However, from reading comments from candidates in the press and on social media, there are clearly concerns over the decision to provide a Level 4 rather than Level 6 qualification, and awarding it only 20 credits.

This does not make the AF7 option quite as clear-cut as it may have been if it offered 30 credits and formed part of a Level 6 pension transfers qualification.

The next couple of years could turn out to be very interesting as other examining bodies work hard to improve and promote their offerings.

Catriona Standingford is managing director at Brand Financial Training