With over 118 financial designations to choose from according to FINRA, it’s difficult to know which ones will be of most benefit to you. In general, this “alphabet soup” of certifications for financial advisors falls into one of two general tracks of designations and educational programs: 1) subject matter knowledge; 2) serving a niche clientele. We serve a broad range of investors and don’t target any particular niche; our clients run the gambit:  investors with assets well over $5 million and complicated financial profiles to the next generation, just beginning to invest beyond their 401[k] at work, to millennials just starting out. Subject matter knowledge is requisite and is therefore the path we chose.

You may already be familiar with the Certified Financial Planner (CFP®) designation. Often clients meet with a CFP®, who, usually for a fee, will create a financial plan for them. The plan is like a roadmap or a blueprint; by definition, a Financial Plan is a comprehensive evaluation of an investor's current and future financial state derived from using currently known variables to predict future cash flows, asset values and withdrawal plans. This type of planning is something we do for all our clients – we just approach it a little differently.

While the terms “financial planning” and “wealth management” are often used somewhat interchangeably amongst practitioners, CPWA is arguably “the” certification for private wealth management. The primary distinction between financial planning and wealth management is primarily about the net worth of the target clientele (in our practice, a particular “segment”), and the kinds of issues that are relevant to such clients. The CPWA goes far deeper than the CFP into areas like private equity and hedge fund investment, ultra-high net worth estate planning strategies, planning for executives and closely-held businesses (potentially worth tens or hundreds of millions), etc.

Another “knowledge-based” or subject matter designation of note is that of the Certified Financial Analyst (CFA®). The practical challenge of the CFA® is that its curriculum delves more deeply into financial analysis than we find necessary for two reasons. First, we have a research team that does individual security analysis for us – it’s their job is to roll up their sleeves and analyze company financials to evaluate stocks and bonds. Secondly, having the CFA®, in addition to the CPWA®, is a bit of “overkill” and, we believe, of limited practical use in our practice.