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Financial Planner Degrees Designations

CFA, CFP, CPA, RIA... What's the Difference?

  • There are many designations out there for financial advisors. Investors often cannot tell the difference or understand what each qualification allows the advisor to do in managing your account(s). We will attempt to briefly describe the differences here. If you have more specific questions or would like more information from us, please contact us.
  • Certified Financial Planner (CFP)- candidate must pass a ten hour exam and agree to abide by a code of ethics. Although the CFP designation is important for financial planning, it does not necessarily mean that every CFP is trained as an investment manager.
  • Certified Public Accountant (CPA)- a CPA has passed a wide-ranging and rigorous test. Surveys have shown that CPAs are the most trusted and respected of financial service professionals. However, a CPA designation doesn't mean that that person is qualified to manage your investments.
  • Chartered Life Underwriter (CLU)- insurance specialist with three years minimum of insurance experience and has completed ten college-level insurance courses. This designation qualifies them to sell insurance, not to be an investment manager.
  • Chartered Financial Consultant (CHFC)- insurance agents who take three more courses than CLUs. You should expect that anyone with a CHFC will seek to sell products associated with the insurance industry.
  • Personal Financial Specialist (PFS)- members have experience in personal finance and pass an exam. Similar to CFP, except CFPs seem to be the more publicized designation.
  • Registered Representative (RR)- a stockbroker who has passed multiple securities exams (Series 6, Series 7, Series 65, etc.) and is registered with a broker dealer.
  • Registered Investment Advisor (RIA)- an individual or firm that has registered with the Securities and Exchange Commission (SEC) or the Security Commission of a specific state. This shows that the individual or firm is in compliance with registration requirements for the SEC or the state Security Commission. Less than 15% of RIAs hold the CFA designation.

 

Source for designation distinctions: Mary Rowland (1997). Best Practices For Financial Advisors. Princeton: Bloomberg Press.

 

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Independent fee-based investment management advisor, retirement planning.

 

Cornerstone Investment Management and Consulting, LLC, 809-C Daphne Avenue, Suite 102, Daphne, Alabama 36526. Fee-based investment management, hourly financial advice and planning. Cornerstone is a Registered Investment Advisor (RIA) registered with the Alabama Securities Commission and is headquartered in the Eastern Shore of Mobile Bay in Daphne, Alabama. Cornerstone is also registered in Florida, Georgia, Louisiana and Texas and permitted to service other states by de minimus exemption.

For more information about our firm, or to receive a copy of our disclosure form ADV, please email us at info(at)csimac.com, or call 251.626.6292. Thank you for visiting our site.