Financial advisors come with an alphabet soup of designations. Here are some of the acronyms that matter most.
Advisors useacronymsthat distinguish them but that can be confusing on first glance. The Financial Industry Regulatory Authority (Finra) lists more than 150 professional designations. Many have value, but some are hyper-specialized and others require very little time or effort to obtain.
Here are a handful of the more rigorous and respected designations:
Chartered Financial Analyst (CFA)
One of the toughest designations to obtain, requiring an advisor to pass three six-hour exams that together require about 750 to 900 hours of study over three years. This designation is on a par with an advanced college degree, and those holding a CFA have shown proficiency in a wide range of financial disciplines, including economics, accounting, portfolio management and ethical behavior.
Certified Financial Planner (CFP)
This designation is aimed specifically at the discipline of financial planning. Advisors must complete a CFP Board-approved educational program, which amounts to about 18 semester hours in various areas of financial planning such as tax strategies, estate planning, insurance, and investing, plus a course that draws all the learning together. There is also a final exam and a continuing education requirement of 30 hours every two years.
Certified Investment Management Analyst (CIMA)
Your advisor is the gatekeeper between you and an industry that really wants to sell you stuff, not all of it in your best interest. The curriculum behind this designation is aimed at helping advisors analyze asset management, investment policy, and risk management, and reflects an advisor’s skills in evaluating investment managers and others who provide financial products. Obtaining a CIMA takes about nine months and includes about 250 hours of study and passing two exams. It also requires completionof a program at a top-20 business school and 40 hours of continuing education every two years.
Registered Investment Advisor (RIA)
Not a designation, but still an abbreviation worth knowing. RIAs are independent financial advisors—a group that has long stood in contrast to the advisors who work for the large brokerage houses. Independent advisors are governed by the SEC and by the fiduciary standard, meaning that they are legally obliged to look out for their clients’ best interests.
There was a time where this fiduciary duty was a huge point of differentiation between RIAs and brokerage-house advisors, but this is changing. Although the Labor Department’s fiduciary rule is officially dead, it has left its mark; more would-be clients understand the importance of working with a financial advisor who is a true fiduciary.
这不是一个职称，但仍然是一个值得去了解的缩写名称。RIA是独立的财务顾问，很长时间以来RIA都和大型券商的顾问对比鲜明。独立财务顾问受美国证券交易委员会(U.S. Securities and Exchange Commission，简称SEC)和信托标准(fiduciary standard)的管理，这意味着他们在法律上有义务关注客户的最佳利益。
Regulation or no regulation, your best defense is to understand how your financial advisor is compensated, and ask point-blank how he or she is putting your best interests first. If an advisor seems too eager to sell you on an unnecessary insurance policy or a mutual fund whose high fees are unwarranted, don’t be shy about asking what’s behind the advice.
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