Choosing An Advisor, Part 2

Tina Haapala |

Investment advisor, financial planner, financial advisor, stockbroker, registered investment advisor, insurance agent, retirement planning specialist, personal financial specialist…what the heck do all these mean and what do they all do? Heck if I know. You see, some of the designations above require specific licenses, some infer a certain level of expertise, and some don’t have any requirements to them at all.
Instead of going through a very long list, with dozens of possible titles and designations, I’m going to concentrate on those that may have a broader scope of expertise—what you might be looking for if you were asking for a financial planner.
In the world of financial planning there are many designations used, but there are three that I hold in highest regard. The first is the one I carry, Certified Financial Planner (CFP®). The other two that earn my approval and respect: the Personal Financial Specialist (CPA-PFS), and the Chartered Financial Consultant (ChFC). Each require formal education, testing, experience in order to be licensed, as well as a commitment to continuing education to stay licensed.
You can find more information on all of these online. The CFP Board website includes the CFP certification requirements, as well as a way to find a Certified Financial Planner in your area. The American Institute of CPAs has an overview of the steps CPAs can take to get the Personal Financial Specialist Credential and where to find one. Finally, for information about Chartered Financial Consultants, go to
To me, each has their own “flavor”. I find that many Certified Financial Planner (CFP) practitioners tend to come from a background in the investment field, or from some of the college programs specializing in financial planning. The Personal Financial Specialist is actually just part of the title: the full one is Certified Public Accountant-Personal Financial Specialist (CPA-PFS). And as you might suspect, CPA-PFS holders have a certain tax flavor to them. On the other hand, Chartered Financial Consultants (ChFC) often come out of the insurance world.
Those flavors don’t make one better than another, but do give you some indication of who you might want to shop for first. If you are mainly interested in investing or general financial planning, then maybe the CFP matches you best. Have issues centering more on taxes? Then the CPA-PFS should be on your short-list. Have general needs, but specific problems in the area of insurance? I’d consider holders of the ChFC.
That all said, any one of the three can handle most any of your issues, depending on the specific expertise of the advisor. So, just because they may lean toward a certain “flavor,” their tastes are influenced by their individual qualifications. Because of this, I wouldn’t limit myself to considering just one designation.
We’ll look at how to determine the expertise of the advisor next week.
This article was published in the WichitaFalls Times Record Newson July 3, 2011.