What are the best financial advisor designations?

The best qualified adviser to serve you will be someone who has:

• appropriate designations/credentialing
  
• solid and relevant experience (relevant to your need)
  
• good ethics (including no black marks on their regulatory record)
  
• and who takes the time to understand you and what's important to you

That said, the best designations for broad-based financial planning are:

• CFP (Certified Financial Planner)
• ChFC (Chartered Financial Consultant)
• CPA-PFS (Certified Public Accountant - Personal Financial Specialist)
  

Beyond that, there are a number of useful specialized designations that focus on specific facets of financial services. Unfortunately, there's also a boatload of dubious designations that give the "appearance" of competence but really are more marketing tools in disguise.
Check out this FINRA link for details on up to 160 designations (yes..."160"...see what I mean about dubious designations?) 

I'll try not to be biased here, but I will say there are dozens of designations available for financial professionals, many of which take little-to-no work to attain. That being said, the designations that take the most effort and education to attain are the CFP, CPA and CPA. 

The CFP stands for Certified Financial Planner. In addition to a qualifying undergraduate degree, a CFP candidate must take several advanced courses covering investments, taxes, estate planning, insurance and the financial planning process. Once they have completed the coursework, they must take an intense cumulative exam. In addition to the coursework and the exam, a candidate cannot use their marks until they have 3 years of financial planning experience.

The CPA, or Certified Public Accountant, is more accounting and tax focused. This designation requires candidates to take several advanced accounting courses in addition to having a business or accounting degree from an accredited institution. Once they have met the educational requirement, they must take 4 exams focusing on different areas of accounting. This typically takes a full year to study for and take these exams.

The CFA, or Chartered Financial Analyst, is an investment and valuation focused designation. Candidates must have a qualifying degree from an accredited instution and pass all 3 levels of the exam. This is one of the most difficult professional examination processes out there, and takes a minimum of 2.5 years worth of testing to attain.

Though a designation shows a commitment to the financial services industry and a focused career, it doesn't necessarily mean they meet your standard. I would highly recommend interviewing more than one professional for the right experience, fit and qualifications.

 Designations are great (I’m proud of my CFP®) but they only mean that a person followed the education curriculum, passed the exam, paid the fees and kept up with the continued education required to obtain the marks. A designation cannot measure the intangibles that a good, personal advisor has to have:

Trust: Is this person looking out for your best interests before his or her own? Are they fully transparent about the fees and commissions they charge? One of the best ways to find a trustworthy adviser is through a referral. Ask your friends with similar financial position who they work with, interview 2 or 3 advisers so you have comparisons, ask the right questions. Use this article to prepare for the first appointment: https://secure.financialfinesse.com/go/3055.

Competence: Your financial advisor should show that he/she is knowledgeable and experienced. Having a designation does not necessarily guarantee this. Ask questions about their investment philosophy, financial planning process and other areas they cover. 

In the end, no one can or ever will be more interested in your financial success than YOU. A good advisor can be of great value, but you have to do the work.

Hi! I agree with Larry and Eric. Whatever designations you choose to look for, be sure to take the extra step to verify that the advisor actually earned and continues to maintain that designation. You can go right to the website of the designation sponsor (such as the CFP Board website to check if some one is a CFP).  After a person earns one of these difficult-to-earn designations, he or she has to take a certain amount of Continuing Education (CE) each year and also keep up with the fees each designation requires.  The CEs can be extensive and expensive, and the fees can be expensive, too, so you want to make sure than an advisor who was at one time a CFP or CFA still is.  Best wishes and thanks for writing!

Kathryn Hauer, EA, CFP®

Admitted to practice before the IRS