“Stockbroker, registered representative, ChFC, CFA…the
titles alone are enough to make your eyes glaze over. But
understanding what they mean can help you know what type
of service to expect.”
- Lorayne Fiorillo, author of
Financial Fitness in 45 Days
Whether you actually need an advisor depends on your own
comfort level with making investment decisions, and how much
time and resources you’re willing to dedicate to maintaining
your investment portfolio, keeping up with the market, and
just plain doing your homework.
If you decide you would like to engage the advice of a professional,
consider the following guidelines will help you in your selection
process:
Broker: An individual--licensed to sell securities--who
acts as an intermediary between you and the companies and
agencies that sell securities on the open market.
Chartered Financial Analyst (CFA): An advisor who
has passed a test--covering economics, accounting, security
analysis, and money management--administered by the Institute
of Chartered Financial Analysts.
Chartered Financial Consultant (ChFC): An advisor
who has completed a program of economics, taxes, insurance,
and investing.
Chartered Investment Council (CIC): An individual
who has passed tests in economics, accounting, taxes, and
money management and has at least five years of relevant work
experience.
Chartered Life Underwriter (CLU): An advisor who has
completed training in life insurance and personal insurance
planning, is licensed by his or her state, and appointed to
sell insurance products by one or more specific insurance
companies.
Registered Investment Advisor: An investment advisor
registered with the Securities and Exchange Commission. No
standardized test for certification is required.
Registered Representative: An advisor who is licensed
to sell securities and has the legal power of an agent, having
passed the Series 7 and Series 63 exams; usually works for
a brokerage licensed by the SEC, NYSE, and NASD.
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What
is a Financial Advisor?
