Johanna Fox Turner, who has provided invaluable advice and help in writing this series. There is a lot of confusion and distrust around Financial Advisors. It doesn’t help that there are several reasons why your beliefs are justified. First, anyone can call themselves a Financial Advisor. Did you know that? I can. You can. Just tell people you are and people will believe you. OK, well isn’t there a license real FAs need to get? Sort of. In some ways, this is one of the most highly regulated professional fields you can find. But people have found ways to get around the regulations, and that is what you need to understand. There are over 100 official “license” designations and “financial advisor” is not one of those designations, just a description that anybody can use to describe themselves. [caption id="attachment_837" align="aligncenter" width="573"] Santorini, Greece[/caption] It’s not that different from non-dermatologists calling themselves dermatologists. In fact, there are doctors who trained in family medicine or internal medicine who literally take a test and pay a fee to get a bogus certification without formal training. How can the public really know the difference since both can say they are “board certified”? The American Board of Dermatology (ABD) is the official body certifying dermatologists. This requires 4 years of formal residency training (after successful completion of medical school) followed by a board certification exam. Like all other specialities, annual continuing education and other measures are required to maintain certification. Throughout residency I had to prove I attained certain milestones and underwent biannual evaluations to ensure I would practice dermatology safely. Again, unless you are a “real” physician, how can you possibly know the difference? There is no official “Financial Advisor board.” Some, just like the sham dermatology board I mentioned above, simply require a test and a fee. Some don’t even require a test! The good news is that there are only 3 that I believe really matter.
- Certified Financial Planner™ or CFP®
- Chartered Financial Consultant or ChFC
- Certified Public Accountant/Personal Finance Specialist or CPA/PFS