The Financial Advisor Acronym Alphabet

financial advisor acronym alphabetWith the growth of the financial advisor profession there has been a corresponding growth of financial designations. A common example of the type of designations I’m speaking about is the very popular CFP (Certified Financial Professional) designation. As with other professions a financial designation is supposed to represent substantial education, training, and/or experience. Many of the agencies with the power to grant designations also require continuing education in order to retain them.

So in theory, hiring someone with a designation is equal to buying a steak with the FDA stamp of approval on it. The buyer knows they are getting a good product. ‘In theory’ is the operative word here.  In the financial world it is quite different. A professional designation at its best means you are hiring someone who is ethical, educated, experienced, and extremely interested in helping you. At its worst it could mean nothing. The astounding number of financial designations out there doesn’t help either.

In my research for this topic I found there are over 100 financial designations inferring competence in every conceivable nook and cranny of the financial world.  Clearly learning an alphabet made up of over 100 acronyms would be quite daunting let alone trying to figure out which ones were any good.

Well fear not dear reader the folks at Paladin Registry have thrown down the gauntlet and requested us financial bloggers to write about this very topic.  Since this is a blog and not a novel I will discuss the designations one is most likely to encounter in the financial world.

Acronym Alphabet.. in (what else) alphabetical order: 

A is for Accredited and Associate. We can skip this letter entirely since I have never met a professional who proudly proclaims “I’m  an Accredited “ anything……as for Associate do you want to hire the “Associate” or the person the “Associate” works for.

B is for Board Certified. Which would be great if we were talking about Attorneys.

C is for Certified and Chartered…the bulk of financial designations are found in this category. Many of them are quality designations but there are also many I would call fluff designations. Fluff designations are easy to spot. They usually aren’t hard to get and/or they aren’t offered by an accredited organization. One such is the CAA -Certified Annuity Advisor. Not only is the granting organization not accredited it also appears to be defunct! A quality designation is one given by an accredited organization after a lengthy period of study and successful completion of an exam. The CFP- Certified Financial Planner and ChFC-Chartered Financial Consultant  are good examples of this type of designation. Here are some other very good designations found in the C’s CFA-Chartered Financial Analyst and CLU- Chartered Life Underwriter.

D is for don’t bother of the three designation under this letter none comes from an accredited organization.

E is for Enrolled Agent (EA)  This is a great designation for anyone looking for a highly qualified tax preparer. The IRS grants this about accredited!

F is for Fraternal and Fellow . The bulk of the designations offered with this appellation are Fluff. To find out the lone good one read on.

G is for GFS- Global Financial Steward. Education requirements none; recommendation from Guy none.

L is for Life, which is the first word heading the LUTCF – Life Underwriter Training Council Fellow. It is granted by the American College an accredited institution which has been in existence for 87 years.

M is for Master, as in Master Financial Planner (MFP). The MFP designation is granted by the American Academy of Financial Management which is accredited by the International Board of Standards.

P is for I’ll Pass. The designations with a P at the beginning of their acronym look very suspect to me.

Q is for Qualified. Ex. Qualified Financial Planner (QFP) Who decides the holder of this designation is Qualified? It doesn’t say. I don’t recommend any of the Q’s.

R is for Registered. The bulk of the designations here I would not recommend except for the RFC which I used to hold. The only reason I recommend it now is because they have raised their prerequisites dramatically.

W is for Wealth Management Specialist (WMS) the lone designation under W. There is no college degree requirement to apply for this designation. I’ll let you  decide it’s merits.

I want to end this alphabetical journey with one very good piece of advice. Many of the institutions who granted designations would allow a person to apply for theirs with minimal requirements if they already held one of the following designations.  CFA, CFP, ChFC, CLU, CPA, EA, LUTC.  Clearly  those designations are very good indicators of quality.

To learn more about Guy Conger, view his Paladin Registry profile.  

Editors Note:  Paladin Registry has researched and found 250+ designations used in the financial services industry.  A report and quality rating is assigned to each of these designations.  To review a designation, go to Check a Credential

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