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Decoding the Alphabet Soup of Financial Advisor Certifications

May 1, 2024 2 min read

So you鈥檝e decided to find a financial advisor. Congratulations! You鈥檙e taking an important step toward a better future for you and your family.

But finding the right financial advisor for you means examining their certifications and designations to ensure they can help you work toward your goals. It鈥檚 easy to find yourself mired in alphabet soup. The range of acronyms, titles, credentials and designations can be overwhelming and intimidating. How do you know what each finance certification and designation means? And how do you know which type of advisor provides the services you want?

Here's a guide to help you decode the most common designations and certifications for financial professionals in the wealth management and insurance industries. With this information, you can more confidently find an advisor who will be the right fit for your needs.

AAMS 鈥 Accredited Asset Management Specialist

Advisors with an AAMS designation have completed a self-study course and an exam covering several topics, including investment strategies, aspects of asset management and allocation, taxation of investment products, and investment risk, return and performance. They renew that certification every two years. An AAMS works with individual clients and small business owners to plan for financial goals, including college savings, taxes and retirement savings. Other areas of advising may include compensation and benefit plans, estate planning, and policy, ethical and regulatory matters.

Broker

A broker is like a bridge 鈥 they鈥檙e a liaison between a buyer and seller (for instance, a client and a securities firm) of an investment or insurance product or fund. Sometimes they鈥檙e called a dealer or broker/dealer. A broker will help you, as the client, by aiding in executing transactions and making sure you have the information you need.

CFP 鈥 Certified Financial Planner

Earning a CFP designation involves a great deal of study and time. Professionals with this designation have several years of experience in financial planning and pass a rigorous exam. They understand the intricacies of the shifting financial market and know how to make financial planning recommendations in your best interest.

CFS 鈥 Certified Fund Specialist

A CFS focuses on mutual funds advising and staying current on mutual fund market information. Someone with this finance certification may also advise in exchange-traded funds (ETFs), real estate investment trusts (REITs) and other retail investments. They also may offer advisory services in advanced fund analysis and selection, portfolio design, asset allocation, taxes and estate planning.

ChFC 鈥 Chartered Financial Consultant

The ChFC credential signals that the professional has the same core skills and knowledge as someone with the CFP designation and has completed extra coursework. Their main focus is on personal financial planning.

CIC 鈥 Chartered Investment Counselor

The CIC designation is awarded to experienced investment advisors. To become a CIC, one must already be a CFA (Certified Financial Advisor). Investment advisors who have established skills in investment counseling and advanced portfolio management can be awarded this certification. It recognizes extensive experience as investment counselors and portfolio managers. Often, a CIC鈥檚 experience comes from overseeing mutual funds and larger accounts.

CLU 鈥 Chartered Life Underwriter

If you鈥檙e looking for someone who has extensive knowledge and experience with life insurance and estate planning, a CLU can help. They鈥檒l work with you to develop a personalized plan for your future in those areas.

CRPC 鈥 Chartered Retirement Planning Counselor

The focus of a CRPC is right there in the name: they鈥檒l work with you on retirement planning. Individuals with this designation know what you need both before and after retirement. CRPCs help clients create a retirement plan. They鈥檙e able to walk through the planning process and advise in the areas of meeting multiple financial goals, retirement income sources, savings and asset management, employer-sponsored retirement plans, estate planning, income taxes and more.

RICP 鈥 Retirement Income Certified Professional

A RICP has similar training to the CRPC but has greater continuing education and experience requirements. Someone with the RICP designation has extensive knowledge of retirement income planning. An RICP can help retirees and those nearing retirement to come up with a plan to manage how their retirement money is distributed. They help retirees live within a realistic and appropriate budget for their lifestyle.

Find the Right Advisor

As you navigate the world of wealth management, knowing what an advisor focuses on can help you determine who will most effectively meet your financial advising needs. Contact a Farm Bureau advisor today to talk about your financial goals and start planning for your future.


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