What are the different types of financial advisor certifications?
Expert financial advice comes in many different shapes and forms, and understanding financial advisor certifications is key to ensuring you get the right guidance. We've explained them all to help you make an informed choice.
There are nine different types of financial advisors, and each has its own specific areas of expertise.
Certified financial advisors may have completed various exams, accumulated practical experience, and undergone extensive mentorships.
Knowing how to find the right financial advisor can ensure that you get the right advice for your situation or circumstances.
Choosing a financial advisor may depend on your budget, referrals, research, and your unique needs.
What are the different types of financial advisors?
In 2024, 27% of Americans worked with financial planners and advisors. But choosing one to match your specific financial circumstances, budget, or needs, can be a challenge - unless you know the different types of financial advisors that are available.
The choice boils down to nine categories of financial advisors.
Most can provide services across a wide range of financial planning requirements. However, each one requires a unique certification to ensure specific, in-depth financial guidance for clients with varying needs, from investment advice to retirement planning.
To help you, here is a list of the different advisor types. Further down, you can find an explanation of what each of them does:
Certified Public Accountant: CPA
Certified Financial Advisor: CFA
Certified Financial Planner: CFP
Registered Investment Advisor: RIA
Investment Advisor Representative: IAR
Chartered Life Underwriter: CLU
Chartered Financial Consultant: ChFC
Retirement Income Certified Professional: RICP
Certified Private Wealth Advisor: CPWA
If you’re hiring someone to manage your personal finances, you don’t want a person who carries this work out on the side or as a hobby. It makes more sense to choose a professional, certified financial advisor that you can trust.
Financial advisor certifications ensure that only the most trustworthy and knowledgeable experts are allowed to provide financial services to individuals or, where relevant, businesses or other organizations that need guidance.
CPA
What does CPA stand for?
In effect, CPAs are accountants but note that not all accountants are CPAs. A CPA earns this professional designation through a combination of education, experience, and licensing. CPAs offer a variety of services, from tax preparation and financial statements to financial planning and forensic accounting.
In addition to completing an accounting program and gaining professional work experience in public accounting, a CPA participant must pass the Uniform CPA Examination.
What is a CPA best for?
A CPA is well-positioned to provide general financial advice concerning everyday money management issues including financial planning, tax, saving, and retirement.
CFA
What does CFA stand for?
CFA stands for Chartered Financial Analyst.CFAs gain certification by passing three investment and related exams that make up the CFA Program overseen by the CFA Institute.
The program provides CFAs with a strong foundation in advanced investment analysis and real-world portfolio management skills.
What is a CFA best for?
CFAs are best for new or existing investors who need help setting up and/or managing a portfolio of suitably chosen investments that are right for their financial needs, risk tolerance, and timeline.
CFP
What does CFP stand for?
CFP stands for Certified Financial Planner.
CFPs require a relevant degree, good performance on the CFP exam, gain relevant work experience, and demonstrate strong professional ethics.
A CFP is a professional who helps people organize their finances in a variety of areas, including, goal-setting, taxes, insurance, investments, and retirement.
What is a CFP best for?
Advising people who require a clear sense of direction with their finances.
RIA
What does RIA stand for?
RIA stands for Registered Investment Advisor.
RIAs are financial professionals or companies that are able to provide you with personalized investment advice and help across most aspects of finance. Unlike other types of financial advisors, RIAs are regulated by the government.
RIAs have a strong fiduciary duty to fulfill. In essence, this means it is their responsibility to make recommendations and manage your money as appropriately for you as possible.
What is an RIA best for?
They cover a wide range of investment-related issues including portfolio advice and management, as well as financial and retirement planning.
IAR
What does IAR stand for?
IAR stands for Investment Advisor Representative.
IARs are licensed professionals employed by investment advisory companies.
After passing the necessary licensing exams, they can provide personalized investment advice and financial planning services to individuals and businesses.
What is an IAR best for?
An IAR is best for accessing a broad range of financial advice relating to investments, including financial planning, portfolio creation, and ongoing wealth management.
CLU
What does CLU stand for?
CLU stands for Chartered Life Underwriter.
A CLU is a professional designation from the American College of Financial Services for individuals who specialize in life insurance estate planning.
To officially become a CLU, it is necessary to obtain a minimum of three years’ relevant industry experience and complete a number of certification courses covering life insurance, income tax, and estate/retirement planning.
What is a CLU best for?
CLUs work with individuals, organizations, and businesses to provide guidance on insurance issues, especially those related to estate planning.
ChFC
What does ChFC stand for?
ChFC stands for Chartered Financial Consultant.
ChFC certification is an advanced financial planning qualification that allows practitioners to develop and implement comprehensive financial plans for both individuals and businesses.
ChFCs offer fee-based financial guidance and advise across multiple areas, including tax, investment, estate and retirement planning.
What is a ChFC best for?
Comprehensive financial planning advice.
RICP
What does RICP stand for?
RICP stands for Retired Income Certified Professional.
RICPs specialize in financial planning for retirees. They can offer guidance on social security, employee benefits management, estate management, and long-term retirement planning.
RICPs are accredited by the American College of Financial Services.
What is a RICP best for?
Retirement planning advice in all its guises.
CPWA
What does CPWA stand for?
CPWA stands for Certified Private Wealth Advisor.
CPWA certifications came about in response to high-net-worth individuals seeking help with the management of their estates.
Accredited CPWAs require five years of experience in financial services and to have completed a relevant course of study.
What is a CPWA best for?
They are best for high-net-worth individuals who want advice about managing their financial affairs, protecting their assets, and passing on their wealth.
How to find the right financial advisor
Identifying the right financial advisor for your unique situation can be difficult when you don’t know where to start.
Here are some tips for how to find the right financial advisor:
Consider your budget: Different financial advisors charge different rates. Make sure your available budget lines up with the fees you can expect to pay going forward.
Understand your needs: The more you know about your financial situation, the easier it will be to select a financial advisor who can offer you help in managing it.
Perform research: Most financial advisors have websites and ratings you can peruse in order to determine whether they would be a good fit for your circumstances.
Get matched with the right advisor: Unbiased helps match people with the best financial advisor for their needs. This is an effective and reliable way to find what you need in a certified advisor.
Seek expert financial advice
Finding the right financial advisor for your situation can be a challenge, but once you have access to the right information, making a choice is easy.
By learning all of these financial advisor certifications, you have already taken a step closer to gaining control of your financial affairs. If you’d like to learn more about finances,
Unbiased can help. Get matched with the right advisor now and get expert financial advice that's unique to your circumstances and situation.
Content Writer
Andrew Michael is a multiple award-winning financial journalist and editor whose work has appeared in numerous newspapers, magazines, and online platforms, including The Times, Evening Standard Money, Financial Times, Shares, and Forbes Advisor.