insurance, retirement, pension and regulatory topics. No comprehensive board exam is required. Like the CLUor ChFC, much of the material in this coursework is also covered in the CFP
Registered Health Underwriter
Chartered Property Casualty Consultant
(CPCU)These designations denote mastery of each of their respective lines of insurance. Each designation requiresthe completion of several courses of intensive academic study, but as with the CLU, ChFC and CEBC there isno board exam. Generally, these designations are only earned by those who intend to spend the duration oftheir careers focusing on health or property-casualty insurance.7.
Chartered Financial Analyst
)This designation is generally considered to be one of the most difficult and prestigious credentials in thefinancial industry, at least in terms of investment management. The academic requirements for thisdesignation are second only to those for CPAs. Three years of coursework must be completed that covers arange of topics and disciplines such as technical and fundamental analysis, financial accounting and portfoliotheory and analysis. Those who earn this designation often becomeportfolio managersor analysts for varioustypes of financial institutions. Holders of these credentials, like CPAs, tend to be compensated chiefly bysalary with performance-based incentives (if they take corporate jobs), or from business revenue, for thosewho start their own private investment management companies. (To learn more, read
What Does "CFA" Mean?
Preparing For A Career As A Portfolio Manager
Separating the Wheat from the Chaff
While these designations have long since been accepted as part of the financial services establishment, the newwave of credentials that has since arisen has served to cloud the validity of some of these older certifications.However, closer analysis of many of these designations quickly reveals that they only require a small fraction of thecoursework that is demanded from the traditional sources of accreditation. For example, the Accredited AssetManagement Specialist (AAMS) and Chartered Mutual Fund Counselor (CMFC) designations can certainly aidadvisors in the investment selection and management process (and will also likely sound impressive to clients andprospects). However, the academic curriculum required for either certification barely scratches the surface of thematerial covered by either the CFA
or even the CFP
curriculums. But while the coursework required to obtainmost other designations does not compare to that of the CFA
, a notable exception has arisen in recent years.The Licensed International Financial Analyst
) credential covers much of the same material as the CFA
curriculum in its coursework, but is considerably more flexible in terms of administration. Unlike the CFA
exams,which are administered at set times in specific, approved locations, LIFA
students can go to any Thomson-Prometric testing site and sit for their exams, which can be administered at least 260 days out of the year. LIFA
exams are also less expensive, and students may also petition to bypass the first two levels of the exam and sitdirectly for level III. It remains to be seen how this newer designation will be compared to the traditional CFA
certification.Indeed, some designations that have recently been created function chiefly as "marketing" designations(i.e.credentials that are geared toward advising senior citizens.) These certifications often focus more on trainingadvisors how to effectively market certain kinds of financial products and services to senior citizens. Therefore, asubstantial portion of the training is geared primarily toward exploring the mindset of the average senior citizen andhow that can be used to induce them to follow the newly credentialed advisor's recommendations.
Certainly, not all financial professionals who earn designations with less stringent requirements are dishonest orincompetent; merely that many of them have not received the same level of training and experience as others whohave earned one or more of the older designations. But even the lesser designations can help advisors to betterassist their clients, if only in specific areas. In terms of marketing, however, the uneducated public will have difficultydiscerning between the services that a Certified Senior Advisor and a Certified Financial Planner
are able toprovide for them. This, of course, has fostered some resentment from advisors who have earned the more difficultcertifications. Many of them are seeking legislation that would either curtail the influx of new designations or clearlylabel them as being lesser in scope. Time and legislation will ultimately determine how this issue gets resolved.For more insight, see
The Alphabet Soup Of Financial Certifications