A financial advisor is a generic job title. The financial services industry is filled with a wide array of similarly generic titles.
Professional designations provide a better opportunity for financial advisors to show they are qualified.
There are many three or four-letter acronyms you might see after a financial advisor’s name. Not all designations are created equal and many have different or inconsistent requirements.
When looking for a qualified financial advisor, here are three most meaningful designations: CFP®, CFA, and CPA.
CFP® – CERTIFIED FINANCIAL PLANNER™
The CFP® designation is considered the gold standard of financial planning.
CFP® exam education focuses on financial planning process and insurance, investment planning, income tax planning, retirement planning and employee benefits, estate planning, and financial plan development.
CFA – Chartered Financial Analyst
The CFA designation is considered the gold standard of investment analysis.
CFA exam education focuses on ethical and professional standards, quantitative methods, economics, financial reporting and analysis, corporate finance, equity investments, fixed income, derivatives, alternative investments, and portfolio management.
CPA – Certified Public Accountant
The CPA designation is considered the gold standard of accounting.
CPA exam education focuses on auditing and attestation, business environment and concepts, financial accounting and reporting, and regulation.