Financial Planning Designation

A financial planning designation can give consumers the peace of mind and confidence to trust the professional they hire. The terms financial planning, or the financial planner, are not regulated. This means that the term can be used loosely, sometimes to the disadvantage of the client.

On the flip side, this has allowed the creation of two advantages for potential clients. For starters, there is more than one designation, representing almost every aspect of the financial services industry, from mutual fund managers to insurance industry experts to Certified Public Accountants with a special planning credential. The second, and perhaps greatest plus for consumers is that each designation typically carries with it a strict code of conduct and ethics.

Find a sound financial guidance professional who has a designation that is in good standing with their professional board that awards the designation. Additionally, ensure that the individual has clients who are willing to provide a testimonial of their delivery of services. Depending upon your own needs, more than one financial planning designation will work for your personal goals of affording parenthood to saving up for a new house. Each financial planning designation may offer different experience and perspective to aid you in investing for your dreams.


For instance, Certified Financial Planners (CFP) are credentialed through the CFP Board of Directors. This financial planning designation represents the most rigorous and vast areas of expertise, particularly in relation to individual clients. A CFP studies more than 100 topics thoroughly, and passes difficult exams to receive their credentials. Therefore, CFPs can be hired for almost any personal money matter, including knowledge on retirement, taxes, insurance and estate management.


The next financial planning designation to know is a Certified Fund Specialist (CFS). They have likewise demonstrated their acumen within the realm of the mutual fund industry. Anyone with the CFS designation can recommend mutual funds for clients. Additionally, if licensed, they can conduct trades on mutual funds for their clients. CFS is awarded from the Institute of Business and Finance (IBF).


Likewise, if you need further expertise in the insurance field, consider The Chartered Financial Consultant, or ChFC financial planning designation. They have earned the right to provide professional advice specifically on insurance, income tax, investment and estate planning. In order to take on the coursework and designation, they must have 3 years' industry experience. Additionally, it is recommended that they only take this line of study if they already have a degree in business or finance. The credentials are awarded through The American College, and focus on ability to educate clients.


If you have a Certified Public Accountant (CPA) who also happens to be a Personal Financial Specialist (PFS), then they can also provide advice. This helps tremendously because their understanding of accounting and tax preparation can boost your tax savings, or at least let you in on the tax implications of one money strategy over another. The PFS credential further expands CPA credentials. It allows them to provide planning advice, in addition to accounting and tax preparation.


Likewise, the Chartered Life Underwriter (CLU) financial planning designation allows an individual to provide advice on the fundamental areas of insurance. These include advising clients on life insurance, benefits, income taxation, investments, health insurance, estate planning, pension planning, and insurance law. Consider how a CLU can help you.


Sometimes professionals you hire for one specific area have many initials and letters after their name. For instance, if you have a greatly experienced, highly knowledgeable planner, check the rest of the letters in their professional designations. One that might surprise you after their name is Chartered Investment Counselor, or CIC.

This defines the individual as an expert in the field of mutual fund management. Yes, they actually manage those big mutual funds or other large accounts that you buy through your 401k or Roth IRA. These credentials require particularly high ethics and personal character references in addition to exhibiting superior portfolio management skills.


Certified Investment Management Analyst, or CIMA, is another financial planning designation that provides a professional the credentials (and proven experience) to work for consulting firms, where they handle very large sums of money for clients.

CIMA covers a vast net of responsibility, including the allocation of assets, risk and performance measurement, investment policy, ethics and due diligence. Only those with at least 3 years' investment consultant experience are allowed to attempt to earn the CIMA credentials. The Investment Management Consultants Association

A financial planning designation may have many meanings, and at first seem confusing. Though, all provide a level of trust through their respective credentialing board via a code of conduct and ethics. Determine your goals, and interview a few professionals before deciding on the one for you.

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