Sean Preston, CFA

Sean Preston, CFA

Sean works with Barry Glassman and the GWS Investment Policy Committee to provide research and due diligence for our investment strategies. As an inquisitive researcher and incisive financial professional, Sean brings his extensive knowledge in all types of investments including equity, fixed income, derivative and alternative assets to select investments and optimize our client portfolios.

You’ve surely noticed the letters and initials following your advisor’s name and wondered what all those financial advisor certifications mean. With over 100 designations to choose from, you might be asking yourself why you should care if your advisor is a CFP®, CIMA®, CFA, CPA, PFS, ChFC, CLU, CPWA, EA, AIF, or anything else.  To mock the ridiculousness of this “alphabet soup” situation, one prominent financial planner used to put “EIEIO” after his name.

Each professional designation in the financial industry differs in terms of the knowledge, experience, and course of study required to obtain it.  This article highlights a few of the most common designations and financial certifications and why those letters aren’t a guarantee of competency or success.

Certified Financial Planner™ (CFP®)

The Certified Financial Planner™ designation is likely the most common financial certification, and for good reason.  The CFP® marks indicate that an individual has an education founded in a broad range of topics relevant to personal financial planning, including portfolio management, budgeting, estate planning, and tax.

The CFP® requires completing an education program/prerequisites, passing a rigorous exam, having three years of financial planning experience, and completing 30 hours of continuing education every two years. If you see the CFP® marks, then you know that the individual has at least three years of relevant experience and an understanding of a broad range of financial planning topics.

Chartered Financial Analyst (CFA)

Some consider the CFA designation to be the gold standard in investing.  The initials indicate a capacity and motivation to learn about a wide breadth of topics including: investments, statistical analysis, economics, financial modeling, and corporate finance.  If you look at a portfolio management team for any mutual fund you are likely to see a CFA or two.

Obtaining the CFA involves a self-study program, three six-hour exams of increasing complexity, and four years of work experience.  Successful candidates tend to take an average of four years to earn their CFA charter.

Certified Investment Management Analyst (CIMA®)

The CIMA® designation, while not quite as well-known as the CFP® or CFA, is an indicator of a deep passion for investments, portfolio management, behavioral finance, and economics.  The course of study also involves a deep dive into statistics and their role in portfolio theory for both individuals and institutions.

Obtaining the designation involves completing an executive education program through institutions like the Wharton School or the Chicago Booth School of Business, passing two exams, proving three years of financial industry experience, and completing 40 hours of continuing education every two years.

Certified Public Accountant (CPA) / Personal Financial Specialist (PFS™)

CPAs tend to work as auditors and tax professionals more than as financial advisors; however, plenty in the financial advisory profession still carry this designation.  CPAs must stay current on accounting rules and regulations for individual and corporate taxation, and there are numerous underlying specialties within the field.  One such specialty is in financial planning, and the Personal Financial Specialist (PFS™) designation is a separate credential for CPAs focusing on financial planning.

Requirements to become a CPA tend to involve state-specified education requirements in accounting, and individuals are required to pass a rigorous exam.  The PFS designation involves a separate exam and two years of financial planning experience.

Chartered Financial Consultant (ChFC®)

The ChFC certification has a similar curriculum to the CFP®, but no board exam requirement.  It focuses on all aspects of financial planning, including investments, tax, estate planning, and insurance.

The ChFC requires the candidate to pass an education program through the American College, three years of full-time business experience, and 30 hours of continuing education every two years.

Why you should look beyond the letters

Financial designations and study programs are a great indicator that your advisor has taken the time and effort to dedicate themselves to their craft and earn the right to use those marks.

However, what really sets an advisor apart is a desire for continued growth and learning.  Ask about your advisor’s future goals for their education.  It’s one thing for an advisor to have obtained a designation years ago, but to continue to learn and expand their knowledge base will serve their clients well.

These are just a few of the commonly held designations in the financial services industry.  When evaluating an advisor, it’s important to look for a variety of knowledge and experience that can apply to your specific financial situation.

Remember to look beyond the letters, as no designation is a guarantee of success.

Get to know the Glassman Wealth team.


Ready to get started?

Connect with a Glassman Wealth advisor today to continue the conversation.